Stephen Poloz says low oil prices could cut growth in 2015

Bank of Canada governor Stephen Poloz estimates if the low price of oil persists, it will knock a quarter-point off the growth of Canada's gross domestic product in 2015.

Poloz made the comment during testimony before the Senate banking committee following the release last week of the central bank's latest monetary policy report and interest-rate announcement.

He says losing a quarter percentage point off the country's economic growth would be big enough to make him concerned.

Poloz says slowing the economy by a quarter point is significant when the bank is predicting moderate growth in the two- to 2.5-per-cent range.

Low rates boosting spending

The central banker says a quarter point matters a lot when Canada needs more than two-per-cent growth to help close the output gap and help create jobs.

Poloz was set to testify at the committee last week, but it was postponed following the deadly Parliament Hill shooting.

He also had a scheduled appearance before the House of Commons' finance committee, which was cancelled after the attack.

Poloz appeared at the Senate committee Wednesday alongside Bank of Canada deputy governor Carolyn Wilkins.

Last week, the bank's monetary policy report said low borrowing rates were a contributor to "renewed vigour" in consumer spending and the real estate market since July.

The bank maintained its trend-setting interest rate at one per cent.