Macquarie Group is warning the slowdown in Canadian housing activity may have a material impact on the country’s economic growth.

David Doyle, the head of North America economics and strategy at Macquarie, said in an interview Tuesday the decline in existing home sales is likely to weigh on growth through the back half of the year by about one percentage point due to the domestic economy’s outsized reliance on the housing sector.

“I don’t foresee a significant pullback in price imminently, interest rates are likely to remain low, and when the [Bank of Canada] does start to hike, probably will be very gradual in its approach,” he said…read more.