The central bank in Canada announced it is leaving borrowing rates alone, yet again.
The Bank of Canada today announced that it is maintaining its target for the overnight rate at 0.5%. The bank rate is correspondingly 0.75% and the deposit rate is 0.25%
A release issued by the central bank this morning pointed to growth in the global economy being expected to strengthen gradually from about 3% in 2016 to 3.5% in 2017-18, a weaker outlook than the bank had projected in its January Monetary Policy Report.
"After a slow start to 2016," the release went on "the U.S. economy is expected to regain momentum, but with a lower profile and a composition that is less favourable for Canadian exports. Financial conditions have improved, partly in response to expectations of more accommodative monetary policy in some major economies."
The central bank also alluded to prices of oil and other commodities as being off their earlier lows and slightly above levels assumed by the bank in January, but remain well below historical averages. Nonetheless, the Bank expects deeper cuts to investment in Canada’s energy sector than were forecast in January. Meanwhile, the BoC notes, the Canadian dollar has firmed, reflecting shifting expectations for monetary policy in Canada and the United States, as well as recent increases in commodity prices.
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