Bank of Canada keeps benchmark rate at record low but economic outlook brightens

Bank forecasting a 6.5% increase in GDP growth in 2021, up from 4% [CBC - April 21, 2021] The Bank of Canada opted to keep its benchmark interest rate steady at a record-low 0.25 per cent Wednesday, saying the pandemic recovery "continues to require extraordinary monetary policy support." At the same time, it significantly increased its growth estimates, forecasting a 6.5 per cent increase this year, up from an earlier prediction of four per cent. The bank said in a statement that it intends to [...]

Read more...

Bank of Canada sees economy shrinking in first quarter as second wave makes for choppy recovery – Interest rate held at 0.25%

[Financial Post - January 20, 2021] Bank of Canada governor Tiff Macklem, an enthusiastic water skier, borrowed from one of his favourite sports to describe the current state of the Canadian economy. “We’ve said for some time that we’re expecting a choppy recovery and, unfortunately, we’re in a very serious chop,” he said on a Jan. 20 call with reporters after the central bank released a new forecast that predicts an economic contraction this winter. The forecast is a disappointing turn. Canada’s economy [...]

Read more...

Money markets are betting Bank of Canada might make ‘micro rate cut’ next week

[Financial Post - January 12, 2021] TORONTO — Money markets see an increased chance of the Bank of Canada cutting interest rates closer to zero, as tightening economic restrictions to contain a second wave of COVID-19 cases offset optimism that activity will rebound later this year. Interest rates were thought to have hit rock bottom in Canada after they were slashed 150 basis points last March to a record low of 0.25 per cent, a level the Bank of Canada considered [...]

Read more...

Bank of Canada stands pat in year’s final rate decision, balancing COVID-19 risks with vaccine optimism

[Globe and Mail - December 9, 2020] The Bank of Canada stood pat on monetary policy in its final scheduled interest-rate decision of an eventful 2020, balancing the near-term economic risks from the second wave of the COVID-19 virus with the arrival of vaccines to alleviate the pandemic. The central bank announced Wednesday morning that its governing council had opted to leave the bank’s key policy rate unchanged at a record-low 0.25 per cent, where it has sat since a series [...]

Read more...

Bank of Canada keeps key interest rate unchanged, says COVID-19 economic recovery likely by 2022

[News 1130 - October 28, 2020] OTTAWA – The Bank of Canada kept its key interest rate on hold Wednesday as it said the country’s economy won’t fully recover what was lost to COVID-19 until 2022, with the road to there dependent on the path of the pandemic. The central bank held its overnight rate target at 0.25 per cent. In July, the Bank of Canada said it believed the country had been spared from a worst-case scenario. The bank’s updated outlook in [...]

Read more...

Bank of Canada expected to cut mortgage rate to near record low

[News 1130 - August 11, 2020]   VANCOUVER (NEWS 1130) — Mortgage rates could near a record low as experts expect the Bank of Canada to cut its five-year mark as soon as this week. CIBC and BMO both cut their five-year mortgage rates by 15 basis points earlier this week to 4.79 per cent. The Canadian Mortgage Brokers’ Association expects an imminent cut to the benchmark five-year rate, as well. The Bank of Canada is expected to reduce the benchmark qualifying rate from [...]

Read more...

Bank of Canada holds key interest rate, forecasts GDP decline

[CTV - July 15, 2020] OTTAWA -- The Bank of Canada will keep its key interest rate at 0.25 per cent until the national economic picture improves, which governor Tiff Macklem said Wednesday will take "a long time." Low interest rates are meant to help households and businesses recover from the COVID-19 pandemic by making borrowing relatively inexpensive. Macklem noted the unusual clarity the central bank provided on the path for its key rate, owing to the unusual level of uncertainty facing Canadians [...]

Read more...

Bank of Canada Announces Rate Hold

Invis - April 15, 2020 It is no surprise the Bank of Canada held firm on its overnight rate of .25% (1/4 percent) and did not venture into negative interest rates that have been tried notably in Europe and Japan with no evidence that negative rates improved GDP outcomes. Generally, economists agree there will not be much of an effect from lower interest rates on new borrowing, because few firms and households will want to borrow to fund investment or [...]

Read more...

Bank of Canada keeps rates at 1.75%, trims 2020 economic forecast

[Global News - January 22., 2020] The Bank of Canada is keeping its key interest rate target on hold at 1.75 per cent and forecasting a slower-than-expected start for the Canadian economy for 2020. The central bank says in its latest forecast that the Canadian economy will grow by 1.6 per cent this year, down 0.1 of a percentage point from its projection in October. While some of the slowdown late last year is being chalked up to a strike at CN [...]

Read more...

Bank of Canada holds rate at 1.75%, says Canada’s ‘resilience’ will be ‘tested’

[Global News - October 30, 2019] The Bank of Canada is keeping its key interest rate on hold in a decision that positions the country as an exception among advanced economies already responding to the weakening world economy. Governor Stephen Poloz’s team says the domestic economy has held up well in many respects and inflation has been close to target. They warn, however, that Canada isn’t immune to the negative effects of slowing global growth. “In considering the appropriate path for monetary [...]

Read more...