But unlike January's surprise announcement, the bank on Wednesday opted not to change its overnight lending rate, leaving it at 0.75 per cent.
Bank of Canada Governor Stephen Poloz will discuss his forecast at a press conference at 11 a.m. ET. CBCnews.ca will carry it live.
Canada's economic ills are acute right now. Poloz, famously predicted GDP growth in the first quarter of 2015 would be "atrocious." Now the numbers are in and show the economy effectively stalled, with zero economic growth in the first three months of 2015. The bank had previously estimated growth of 1.5 per cent for the same period.
The central bank says the economic strife caused by oil prices is proving to be more "front-loaded" than predicted, but not larger. It anticipates non-energy exports will start to improve and investments will increase around mid-2015. By the end of 2016, the bank estimates the economy will have reached full capacity.
The bank has also shifted its prediction for overall economic growth in 2015 to 1.9 per cent.
That's roughly in line with the average of the private-sector economists Finance Minister Joe Oliver with last week. They predicted 2 per cent growth for 2015, which is the number Oliver says he plans to use when making his planning assumptions for the budget he intends to table next week.