Bank of Canada
Central Bank Decisions, a U.S. PMI Surprise, and a Further Advance in the Price of Oil
September 6, 2023
The U.S. Institute of Supply Management delivered a surprisingly buoyant U.S. non-manufacturing purchasing managers survey for the month of August, showing an overall 6-month high reading of 54.5 versus 52.7 in July and including a 2.1-point increase in the inflation subindex to 58.9. This news eclipsed the other S&P Global U.S. PMI news of 6- […] More
Bank of Canada Overnight Target Interest Rate Lifted from 4.75% to 5.0%
July 12, 2023
Acting at every scheduled policy review from March 2022 until January 2023, the Bank of Canada governing council had raised its interest rate target from 0.25% to 4.50% and also began a program of balance sheet reduction that supplemented monetary tightening. The rate was not changed at the following two reviews, but a cycle of […] More
Canada’s Overnight Interest Rate Target Lifted 25 Basis Points to 21-Year High of 4.75%
June 7, 2023
The Bank of Canada had paused its cycle of interest rate tightening after raising its target from 0.25% prior to March 2022 to 4.50% with a 25-bp hike this past January. That pause ended today with the unexpected 25-basis point increase to 4.75%, and a released statement fails to say one way or the other […] More
Bank of Canada’s Policy Interest Rate Held steady at 4.50%
April 12, 2023
Canada’s key interest rate had been raised at all eight scheduled policy reviews from March 2022 through January 2023 by a total of 425 basis points from 0.25% to 4.50%, but no change was made at the March 2023 review, nor today. As was the case in March, officials have not ruled out a further […] More
Latest Bank of Canada Rate Hike to Be Followed By a Pause at 4.50%
January 25, 2023
When rate tightening by the Bank of Canada began in March 2022, the benchmark had been languishing at 0.25% for the previous two years since a trio of 50-basis point cuts in March 2020 shortly after the onset of the Covid pandemic. Today’s eighth hike, like that first one, was 25 basis points in size. […] More
Central Bank Rate Hikes in India and Canada
December 7, 2022
The Reserve Bank of India‘s repo rate was increased 35 basis points to 6.25%. That was the fifth hike this year from a starting level of 4.0% that had prevailed since May 2020. Indian CPI inflation, although down to 6.8% in October from 7.4% in September, remains well above target. The 6.25% new interest rate […] More
50-Basis Point Central Bank Rate Hike in Canada and More Tightening to Come
October 26, 2022
Today’s 50-basis point increase of the Bank of Canada‘s overnight rate target to 3.75% follows five consecutive hikes since March totaling three percentage points. More rate hikes will follow, and quantitative tightening to reverse some of the balance sheet growth during the pandemic will also continue. Although indicators of long-term expected inflation remain fairly well-anchored, […] More
Bank of Canada Rate Hike
September 7, 2022
The Bank of Canada Board engineered an as-expected 75-basis point rate hike to 3.25%. This was the fifth increase since March from a pandemic base of 0.25%. The rate level is at a 14-year high, and more increases and continuing quantitative restraint lie ahead. According to a statement, “The effects of COVID-19 outbreaks, ongoing supply […] More
A Busy Wednesday as Central Banks Compete with Data for Market Attention
September 7, 2022
Dollar strength continues, with another 20-year high touched overnight by the weighted DXY index. At 144.98, the dollar climbed 1.4% overnight and to its highest Japanese yen value since August 1998 when the Asian debt crisis was raging. The greenback also has advanced 0.8% versus sterling and 0.3% vis-a-vis the Canadian, Australian and New Zealand […] More
Bank of Canada Beats Expectations with a 100-Basis Point Rate Hike that May Foreshadow the Fed’s Next Move
July 13, 2022
The fourth Canadian central bank rate hike of 2022 followed earlier increases of 25 basis points in March and 50-basis point moves in April and June. The new 2.5% rate level is 75 basis points above the pre-pandemic level of 1.75%. All three 50 basis point cuts in 2020 had been implemented near the start […] More
