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5 Mar 2014
BoC keeps interest rate steady at 1% in March
FXStreet (Łódź) - As widely expected, the Bank of Canada decided to keep its target for the overnight rate unchanged at 1% at its March monetary policy meeting.
The central bank predicted that inflation would remain well below the 2 % objective. As for GDP, it came in slightly stronger than projected in the fourth quarter of 2013 and now is expected to grow by 2.5% in 2014.
In a statement released after the decision was made known, the BoC said that the global economy was seen improving, with stronger growth expected this and next year. It took note of the increased financial volatility in global financial markets, with the crisis in Ukraine adding to the geopolitical uncertainty.
The BoC decided that “the balance of risks remains within the zone for which the current stance of monetary policy is appropriate.”
“The fundamental drivers of growth and inflation in Canada continue to strengthen gradually, as anticipated. With inflation expected to be well below target for some time, the downside risks to inflation remain important. At the same time, the risks associated with elevated household imbalances have not materially changed.”
The central bank predicted that inflation would remain well below the 2 % objective. As for GDP, it came in slightly stronger than projected in the fourth quarter of 2013 and now is expected to grow by 2.5% in 2014.
In a statement released after the decision was made known, the BoC said that the global economy was seen improving, with stronger growth expected this and next year. It took note of the increased financial volatility in global financial markets, with the crisis in Ukraine adding to the geopolitical uncertainty.
The BoC decided that “the balance of risks remains within the zone for which the current stance of monetary policy is appropriate.”
“The fundamental drivers of growth and inflation in Canada continue to strengthen gradually, as anticipated. With inflation expected to be well below target for some time, the downside risks to inflation remain important. At the same time, the risks associated with elevated household imbalances have not materially changed.”