Interest rates in Canada are staying put for now, after the Bank of Canada held its monetary policy steady on Wednesday.
The benchmark, or overnight, lending rate stands at 2.75 per cent, and represents the floor level of interest off of which banks can base their “prime” rate.
This is the second straight monetary policy meeting where the central bank opted to leave the benchmark rate unchanged, citing the uncertain economic outlook in a statement:
“With uncertainty about US tariffs still high…Governing Council decided to hold the policy rate as we gain more information on US trade policy and its impacts.”
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A press conference at 10:30 a.m. Eastern will feature Bank of Canada Governor Tiff Macklem, who will shed more light on what led to the decision.
Statistics Canada said Friday that real gross domestic product topped expectations in the first quarter of the year as businesses rushed to get ahead of the tariff impact.
The Bank of Canada said in April it would be less forward-looking for the time being and did not publish a central forecast for inflation and economic growth amid the considerable uncertainty.
Annual inflation cooled to 1.7 per cent in April, dragged down by the removal of the consumer carbon price even as underlying inflationary pressures ticked higher.
More to come.
– With files from the Canadian Press
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