No Rate Changes today from Bank Of Canada
Published by Dave Stevens on January 18, 2011
The Bank of Canada left interest rates unchanged on Tuesday, but said the economic outlook had improved since October, with growth now likely to be about 2.4% this year.
The central bank said the economy will grow about 2.8% in 2012. The projections are slightly stronger than its estimates in the Fall Monetary Policy Report. Inflation remains subdued and core inflation will gradually rise to the bank's 2% target by the end of next year, it said.
"The global economic recovery is proceeding at a somewhat faster pace than the Bank had anticipated, although risks remain elevated," it said in a release.
Canada was the first G7 nation to raise interest rates following the recession as its economy rebounded sharply, driven by the rising property market and strong domestic spending.
The bank hiked a further two times during the summer before pausing in September as the global economic recovery faltered. Another rise would have pushed up the value of the loonie, further weighing on already weak exports, economists said.
Since then, sentiment has improved, both in Canada and the U.S., where recent indicators have shown the recovery is gaining traction.
The overnight rate remains at 1%, with the bank rate 1.25% and the deposit rate at 0.75%.
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