Bank of Canada holds interest rate steady as it forecasts inflation to slow to 3% this year

Bank of Canada holds interest rate steady as it forecasts inflation to slow to 3% this year
On Wednesday, the Bank of Canada chose to maintain its current interest rate of 4.5, given the ongoing impact of the former rate hikes on the frugality. This decision was extensively anticipated by economists due to the central bank’s former suggestions of a pause on rate hikes. The bank had raised rates eight times between March 2022 and February of this time, following its original move to drop its standard lending rate during the early stages of the epidemic to stimulate the frugality.

Following a period of rising affectation, Canada’s affectation rate peaked at further than eight per cent in June 2022. Still, as of February 2023, it had dropped to just over five per cent, and it’s anticipated to have fallen further to as low as four per cent based on the data to be released next week.

In its policy statement on Wednesday, the bank stated in the Monetary Policy Report that it projects the official inflation rate to decrease to three per cent by mid-year and eventually reach the two per cent target rate by the end of next year. While leaving the possibility of future rate hikes open, the bank’s policy makers emphasized that the current rate changes are having the intended effect of slowing the economy to curb inflation.