Macklem: Additional Govt Spending Could Start Getting In The Way

From the BoC Q&A:

• In our MPR forecast, government spending simply reflects announced spending plans for all levels of government.
• That suggests real government spending will grow between 2.25-2.5% vs potential output growth of 2%.
• It’s at the upper end of that, suggesting if governments spend all of that it’s not going to help us relieve inflationary pressures but it’s not seriously getting in the way either.
• If governments were to add more spending on that of what they’ve already planned it certainly could start getting in the way.

Can the recent immigration ruling have a sizeable impact on housing?

• Rogers: In short-term, immigration can put upward pressure on prices. We had a particularly big surge in population growth through immigration last year. The policies that were announced are on their way to relieving some of the pressure on rents but we’ll keep an eye on it.