Bank of Canada Holds Key Interest Rate Target at 4.5 Percent Owing to Economic Growth, Declining Inflation
Bank of Canada has maintained its key interest rate target at 4.5 percent analyzing the growth and inflation. The Governing Council will continue to assess the economic situation and remain prepared to raise the policy rate further if needed. The bank will also continue its policy of quantitative tightening.
The Bank of Canada has announced it will hold its target for the overnight rate at 4.5 percent, the Bank Rate at 4.75 percent, and the deposit rate at 4.5 percent. It will continue its policy of quantitative tightening. In Canada, even though the demand still outweighs the supply, the economic growth in the first quarter of this year has been higher than initial projections from January.
The bank also shared that the increase in population is contributing to the labor supply and supporting employment growth while also boosting aggregate consumption.