Bank of Canada

December 7, 2016

This month’s Bank of Canada policy meeting, the last scheduled for 2016, was not synchronized with one of the four full monetary policy reports produced each year. As expected, the overnight money target was left at 0.50%. Since the end of the Great Recession, the rate has been changed just five times: three 25-bp increases squeezed between June and September of 2010 and, more recently, cuts of 25 basis points each done in January and July of 2015.

A released statement reiterated the perceived appropriateness of the current stance. Governing Council members agreed the global economy had strengthened lately but maintained that uncertainty had not diminished. Note is made that Canada’s economy has considerably more slack than the United States, and global forces have raised even Canada’s long-term interest rates significantly. Faster Canadian growth last summer did not extend into the autumn.

Copyright 2016, Larry Greenberg. All rights reserved. No secondary distribution without express permission.



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