Reuters conducted a poll this week with 40 economists which lead to this conclusion: the Bank of Canada is not likely to increase interest rates until the end of 2020. In fact, there’s a 40% chance that we’ll see them make cuts to interest rates in that time. Reasons cited for these probabilities included a slow economy and continued world trade tensions.

Despite this ho-hum projection, the Bank itself remains optimistic, stating recently that it expects to see Canada’s economy pick up in the second half of this year. A rare few align themselves with this outlook and expect to see up to two interest rate increases by the end of next year. But obviously, not everyone agrees. Morgan Stanley, one of the participants in the Reuters poll, wrote, “We see little impetus for policymakers to resume rate hikes over our forecast horizon, as sluggish growth and lingering slack in the economy will continue to warrant leaving some policy accommodation in place.”

There’s a good chance the Bank will have to make some cuts if we don’t see the economy picking up pace in the very near future. Stanley agrees. “If growth fails to show any convincing signs of a rebound in 2019, we think the risks of rate cuts will increase, and given our sluggish outlook, we place a subjective 40 per cent probability that the BoC will deliver at least one 25 basis point rate cut over the next 12 months.”

The US-China trade agreement has put a lot of stress on trade worldwide and but most especially on Canada because the US is our biggest trading partner. A separate Reuters poll taken earlier this month showed that the prospect of a US recession is more and more likely. If this happens we can expect to see Canada follow suit pretty quickly. According to yet another Reuters poll from April, Canada is 20% likely to go into a recession in the next 12 months and 27.5% like in the next 24.

In relation to housing, prices are expected to remain the same for the rest of 2019 and to increase by 1.7% in 2020, according to another May Reuters poll.