Canada: Central Bank leaves interest rates unchanged
December 7, 2010
At its latest meeting on 7 December, the Bank of Canada (BoC) maintained the target for the overnight rate unchanged at 1.00%, in a move widely anticipated by the market. The decision was made as the recovery in Canada is proceeding at a moderate pace and risks to the global economic recovery have increased. Although the BoC began tightening its monetary policy in June, further hikes in interest rates are unlikely over the short term. According to the Bank, inflation remains broadly in line with its expectations. The Bank maintains a dovish tone, observing ?an environment of significant excess supply in Canada? and stating that ?any further reduction in monetary policy stimulus would need to be carefully considered?. The next policy meeting is scheduled for 18 January 2011, accompanied by a new Monetary Policy Report, containing an update of the Bank's outlook for economic activity and inflation, on the following day.