Bank of Canada’s Interest Rate Announcement: Rate Holds Steady at 5%
The Bank of Canada held its overnight rate at 5% in Wednesday morning’s interest rate announcement, which was widely expected as the economy shows signs of slowing down. The Bank did leave the door open to the possibility of further interest rate hikes in the future, noting the “persistence of underlying inflationary pressures.“
CPI inflation eased back to 2.8% in June, before rising to 3.3% in July, which is somewhat in line with the Bank’s 3% projection. “The longer high inflation persists, the greater the risk that elevated inflation becomes entrenched, making it more difficult to restore price stability,” according to the Bank’s interest rate announcement.
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