Categories: BusinessCanadian NewsCanadian PressPolitics

Bank of Canada widely expected to get back on its rate-hiking path

OTTAWA — After waiting for half a year, Stephen Poloz appears ready to get back on his rate-hiking path this week.

Recent signals from the Bank of Canada governor, combined with strong economic data, have experts widely predicting Poloz will raise his trend-setting rate Wednesday from its current level of 1.25 per cent.

Citing a cautious, data-dependent approach, Poloz hasn’t touched the rate since he increased it in January, a move that followed increases last year in September and July.

Another rate increase this week would come with Canada facing a number of trade-related uncertainties, including NAFTA talks, U.S. steel and aluminum tariffs and the threat of more duties on the economically critical automotive sector.

But TD chief economist Beata Caranci says she expects Poloz to work with the data he has in front of him and many analysts point to healthy numbers of late — including the Bank of Canada’s own survey on business sentiment, jobs numbers and growth in wages.

Caranci says if the trade dispute deteriorates further she believes hiking the interest rate now would give Poloz more flexibility to possibly lower it down the road, if necessary.

While expectations are high that Poloz will raise the rate this week, some experts predict the ongoing trade uncertainty will be enough to keep Poloz on hold for a little longer.

The National Bank of Canada wrote in a recent note that trade developments since the central bank’s last meeting, including stalled NAFTA talks and a possible trade war between the U.S. and China, will be enough to give Poloz pause.

In making the call, the National Bank acknowledged that it’s an outlier in a market that widely sees the right conditions for another increase.

The Canadian Press

Thank you for your support

Help independent journalism thrive. Join our Patreon community.


The Canadian Press

As Canada’s national news agency for 100 years, The Canadian press has provided Canadians an unbiased news source, driven by truth, accuracy, and timeliness.

Comments are closed.

Share
Published by
The Canadian Press

Recent Posts

  • Ontario News
  • Opinion
  • Politics

NDP MP calls Doug Ford, “White Trash”

The MP's decision is likely a worrying step towards more divisive and offensive language in Canadian politics.

4 hours ago
  • Canadian News
  • Energy
  • Environment
  • Politics

If we want to avoid the worst effects of climate change, why do we think a puny carbon tax is the solution?

Are there better solutions for fighting climate change than a carbon tax?

7 hours ago
  • Analysis
  • Canadian News
  • Editorial
  • Politics

LINDSAY: Are illegal border crossers jumping the queue?

Canada has a defacto open borders policy when it comes to asylum seekers.

8 hours ago
  • Canadian News
  • Politics
  • TPM Exclusive

Woman may sue after allegedly being manhandled by Trudeau’s security

She now has a GoFundMe page set up and it is rapidly growing.

1 day ago
  • Culture
  • Opinion
  • Politics

Why Titania McGrath is funny

Titania McGrath must be swimming in the progressivism she mocks because you can’t mock that well from a distance.

1 day ago
  • Canadian News
  • Opinion
  • Politics

The government retreats from compelled speech on Summer Jobs program

No more forced speech, but censorship of the “wrong” opinions continues.

1 day ago