The Bank of Canada, at its monetary policy meeting yesterday decided to hold the interest rates steady at 0.50%, as widely expected. Stephen Poloz, the BoC’s governor, said that there were significant uncertainties that weighed out the outlook for Canada’s economy, opting to keep interest rates steady.
The BoC’s meeting comes hot on the heels of latest inflation figures. Data from Statistics Canada showed that inflation rate rose 2.1% in January. But the positive data did not reflect much in the BoC’s statement. The central bank, on the other hand, cautioned that with the exception of higher energy prices that came as a result of higher carbon taxes in two of Canada’s provinces, the actual cost of living in the country was rising at a much slower rate.
The central bank’s statement said that it was looking past these effects which it termed as being temporary, in reference to the carbon taxes and higher energy prices and pointed out the material excess capacity in the economy.
Read more: https://www.orbex.com/blog/2017/03/canadian-dollar-weakens-boc-holds-rates-steady/