By: Thomas I. Likness
Eagle News Service
(Eagle News) — Following eight months of interest rate increases, the Bank of Canada hit the pause button Wednesday and maintained its key overnight rate at 4.5%.
In a release, the bank said there is no need for an increase at this time.
“Overall, the latest data remains in line with the Bank’s expectation that CPI inflation will come down to around 3% in the middle of this year,” the bank said.
The Bank of Canada is the first major central bank to maintain its current rate.
Inflation in Canada eased to 5.9% in January, reflecting lower price increases for energy, durable goods and some services.
“Price increases for food and shelter remain high, causing continued hardship for Canadians. With weak economic growth for the next couple of quarters, pressures in product and labor markets are expected to ease,” said the bank. “This should moderate wage growth and also increase competitive pressures, making it more difficult for businesses to pass on higher costs to consumers.”
The next rate announcement is expected on April 12th.
(Eagle News Service)