Federal stimulus budget won’t boost economy

The 2016 Federal budget delivered today provides only a modest fiscal stimulus response to the flagging economy. Despite the more dismal GDP growth outlook this year, policymakers weren’t comfortable providing much more fiscal stimulus beyond what was indicated last year. This leaves the pressure on the Bank of Canada to try to lift the economy, with an additional interest rate cut, to 0.25% from 0.50%, still likely before the middle of this year.