Economy to grow 3.2% in 2011: RBC
The Royal Bank of Canada says the economy will grow by 3.2 per cent this year, assuming American rising demand for consumer goods and autos.
A report from RBC Economics says demand for Canadian commodities will keep the loonie high and help Canadian businesses import equipment from abroad.
It also predicts the Bank of Canada will increase overnight interest rates to two per cent by the end of the year. That would be a full percentage point higher than the central bank's current policy rate.
Labour market conditions should be stable in 2011 while disposable income will see a 4.1 per cent gain.
The report says net exports and consumer spending helped drive Canada's economy to higher-than-expected gains in 2010.