One prominent economist says Canada is facing economic weakness amid higher interest rates and says the Bank of Canada is late in bringing interest rates lower. 

David Rosenberg, the founder and president of Rosenberg Research, said in an interview with BNN Bloomberg on Monday that Canada’s economy is weaker than headline figures suggest and conditions in the labour market are starting to erode. Following reports that Canada’s economy added 41,000 jobs in February, Rosenberg said the increase isn’t significant when accounting for population growth. 

“Actually, the most important statistic is the employment-to-population ratio, which is now down for five months in a row,” he said. 

According to Rosenberg, the labour market “is starting to adopt more slack and that’s going to show up with a lag on decelerating wage growth.” He added that he is leaning toward a rate cut occurring in the coming months.

“That's going to play in very nicely for the Bank Canada to start cutting rates probably in the spring,” he said. 

Ed Devlin, the founder of Devlin Capital and senior fellow at the C.D. Howe Institute, said in an interview with BNN Bloomberg Monday that the Bank of Canada is likely to “overtighten by waiting too long” to bring interest rates down. 

He said the correct move from the central bank would have been to move rates “down quickly” but is instead trying to maintain “inflation-fighting credibility.” 

Rosenberg also highlighted that the economy is “fundamentally weak.” 

“I think that the Canadian economy, you could argue, is already in a recession. There's plenty of indicators…GDP (gross domestic product) per capita, real income per capita are telling you that,” he said.

“So I think it's too late in both directions. The bank acted too slow to raise rates. They acted too slow to cut rates.”