Trudeau pledged to slow immigration. The Bank of Canada has doubts

There’s mounting uncertainty about when and by how much Justin Trudeau’s government will be able to reduce the number of temporary residents in Canada, muddying a key input for fiscal and monetary policymakers.

The Bank of Canada raised its population growth forecasts Wednesday, saying the government will probably need more time to limit non-permanent resident inflows. It predicts the number of people over 15 in Canada will rise by 3.3% this year, up from about 3% previously. The pace — among the fastest in the world — is boosting output and likely kept the country from falling into an outright recession.

The bank’s latest estimates in its July monetary policy report show population growth decelerating at a slower pace than it had previously expected, reaching 1.7% in both 2025 and 2026, more than half a percentage point higher than in its April report.

That’s because bank officials say it will take longer for planned policies to bring the proportion of non-permanent residents — including international students, foreign workers and asylum-seekers — to the federal government’s 5% target. The bank puts the share at 6.8% of the Canada’s population and rising in the near term.

The timing of the reduction has major implications for the country’s monetary policymakers, who are tasked with setting interest rates without any firm details on the federal government’s plans. Clarity on changes to permit programs isn’t expected until later this year, the bank said, and it’s already expecting to revise forecasts as further measures are announced.

Source : https://economictimes.indiatimes.com/nri/migrate/trudeau-pledged-to-slow-immigration-the-bank-of-canada-has-doubts/articleshow/112033187.cms