Canada is expected to hold the line on interest rates, according to a survey of economists.
A majority of economists who were asked for their opinion on the subject said they expect Bank of Canada Governor Stephen Poloz to keep interest rates at their current levels for at least another year.
Even with renewed speculation about an impending global recession and a trend among the world’s central banks toward easing monetary policy, a Bloomberg survey shows that a majority of economists still expect Canada’s central bank to keep its benchmark overnight interest rate at 1.75% until the end of 2020.
The underlying strength of Canada’s economy may be keeping the bulk of analysts in the more hawkish camp. As global trade uncertainty mounts, key Canadian indicators continue to beat expectations, such as back-to-back trade surpluses and an acceleration in the housing market.
Of the 15 economists surveyed by Bloomberg, nine expect the Bank of Canada to remain on hold to the end of 2020. Domestic banks are among the more optimistic, with Toronto Dominion (TSX:TD), Bank of Montreal (TSX:BOM), Scotiabank (TSX:BNS), National Bank (TSX:NA) and Laurentian (TSX:LB) expecting the central bank to hold well into next year.
