Bank of Canada Leaves Overnight Rate at 0.50%

May 24, 2017

There have been only five changes in the Bank of Canada interest rate, all by 25 basis points, since the Great Recession ended for a net change of +25 basis points. The first three moves in June-September of 2010 were increases, and the most recent two were cuts in January and July of 2015. A statement released after the latest review “judges that the current degree of monetary stimulus is appropriate at present” Overall inflation has subsided since the April Monetary Policy Report as was expected. “The Bank’s three measures of core inflation remain below two per cent and wage growth is still subdued, consistent with ongoing excess capacity in the economy.” Global and Canadian outlooks face significant uncertainty, and another observation is that “t very strong growth in the first quarter will be followed by some moderation in the second quarter.”

Copyright 2017, Larry Greenberg. All rights reserved. No secondary distribution without express permission.



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