The Bank of Canada announced today that it is holding the overnight rate steady, again citing escalating geopolitical and trade conflict risks, which are undermining the global expansion. The Bank also noted that in Canada, the response to the strict qualifying guidelines that went into effect January 1 slowed first quarter growth. The next rate-setting day is Wednesday, May 30.
Today’s Bank of Canada rate hold announcement marks almost four straight years that the key benchmark rate has remained unchanged, since September 8, 2010. Great news if you have a variable-rate mortgage or home equity line of credit; the prime rate stays at 3%.
The announcement noted that “the risks to the outlook for inflation remain roughly balanced, while the risks associated with household imbalances have not diminished.” With these considerations, the Bank is maintaining its monetary policy stimulus, and remains neutral with respect to the timing and direction of the next change.
The next rate-setting day is October 22nd.