RBC cuts Canada growth forecast to 1.7%, warning oil will make this year worse than thought

TORONTO – Royal Bank says low oil prices will make 2016 more challenging for Canada’s economy than previously thought.

The bank has lowered its forecast with this year’s gdp to simply 1.7 percent.

That’s down from RBC’s December forecast of 2.2 per cent growth this season.

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RBC continues to expect Canada’s economic growth will be underpinned by solid consumer spending, stronger exports and stimulus from the authorities.

But it says oil prices were less than estimated early this year and they’ll weigh on business investment.

The bank’s latest quarterly economic forecast estimates the typical cost of West Texas Intermediate crude will be US$40 per barrel this year – $12 less than its previous forecast in December.

RBC is also lowering its 2017 oil price estimate to US$57 per barrel from $62.