Bank of Canada Interest Rate Announcement 6 Mar 2013
Today the Bank of Canada announced interest rate announcement was release. The Bank of Canada is maintaining its target for the overnight rate at 1 per cent and the Bank Rate is correspondingly 1 1/4 per cent and the deposit rate is 3/4 per cent.
Here is a summary of the key points from the announcement:
1) The global economic outlook is broadly consistent with the Bank’s projection in its January Monetary Policy Report (MPR).
2) Canada’s economy grew by 0.6 per cent at annual rates in the fourth quarter of 2012. The Bank expects growth in Canada to pick up through 2013, supported by modest growth in household spending combined with a recovery in exports and solid business investment.
3) Total CPI inflation has been somewhat more subdued than projected in the January MPR as a result of weaker core inflation and lower mortgage interest costs. Low core inflation reflects muted price pressures across a wide range of goods and services, consistent with material excess capacity in the economy.
4) Reflecting all of these factors, the Bank has decided to maintain the target for the overnight rate at 1 per cent. The considerable monetary policy stimulus currently in place will likely remain appropriate for a period of time, after which some modest withdrawal will likely be required, consistent with achieving the 2 per cent inflation target.