The Bank of Canada (BoC) is widely expected to leave interest rates unchanged at current levels when it concludes its latest policy meeting today (Oct. 25).
A majority of economists are forecasting that Canada’s central bank will pause its rate hikes as data shows an economic slowdown taking hold across the country.
In July of this year, the Bank of Canada raised its trendsetting overnight interest rate to a 22-year high of 5% and said that more rate hikes might be needed to lower inflation back down to its 2% annualized target.
However, the central bank held rates steady at its last policy meeting in September as economic growth across Canada shows signs of weakening, and as inflation continues to come down.
The Bank of Canada has raised its overnight interest rate 10 times since March 2022 to lower consumer prices, which peaked at 8%.
Inflation in Canada has been steadily declining. In September, the annualized inflation rate came in at 3.8%, down from 4.0% in August of this year.
The Bank of Canada is scheduled to publicly announce its latest interest rate decision at 10 a.m. Eastern time today.
A poll of economists by the Reuters News Agency found that most think the Bank of Canada is now done raising interest rates but will likely hold them at 5.0% for the next six months.
A majority of economists expect that Canada’s central bank will begin lowering interest rates in the middle of 2024.
Money markets have priced in a 13% chance that the Bank of Canada will raise interest rates again by year’s end.
