Bank of Canada Keeps Overnight Lending Rate

According to the latest announcement from the Bank of Canada, the overnight lending rate of 1 per cent will remain in effect.

According to the Canadian Real Estate Association, “The overnight rate has not moved in almost four years, and the Bank’s July announcement and accompanying Monetary Policy Report suggest the most likely scenario right now is that the overnight rate will remain parked where it is for at least another year and a half.”

They continued, “With inflation having ‘moved up to the 2 per cent target in recent months, sooner than expected,’ talk of a rate cut has all but gone away; however, the Bank attributes the recent rise in inflation to temporary effects, specifically higher energy prices, a lower Canadian Dollar, and other sector-specific shocks rather than to any change in domestic economic fundamentals.”

The next scheduled rate announcement is September 3.


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