The Bank of Canada holds key interest rate at 5%
The Bank of Canada maintained its policy rate unchanged for the fifth meeting in a row, noting improvements in inflation but emphasizing that it is not yet the right time to think about reducing rates.
The bank emphasizes the need for continued patience and asserts that higher rates require more time to demonstrate their effectiveness.
In today's statement, the bank reiterated that elevated shelter prices are the biggest contributor to inflation, and noted that yearly and three-month measures of core price pressures are stuck in the 3% to 3.5% range.
The economy is growing slowly, but it’s not rapidly worsening, expanding at a one per cent annualized pace at the end of last year. Recession calls among major lenders have faded, and a so-called soft landing is increasingly seen as the most likely scenario.
The bank’s next rate decision is on April 10, when policymakers will also update their economic projections.
Most economists are predicting the first rate cut to happen in June.
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Darcy Doyle at The Mortgage Professionals
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