Q1 gdp forecast to 1.3 pct from 2.5 pct, sees q2 at 2.5 pct; raises potential output growth to 1.8 pct in 2018-20, 1.9 pct in 2021

Q1 gdp weaker than forecast, rebound seen in q2; economy to operate above potential over next three years, helped by provincial, federal fiscal measures

Inflation in 2018 likely to be modestly higher than expected in jan before returning to target

Inflation close to 2 pct as temporary factors have dissipated; rise in core inflation consistent with economy operating with little slack

Some policy accommodation will still be needed to keep inflation on target; monitoring economy's sensitivity to rate movements, evolution of economic capacity