Wednesday, March 2, 2011

Bank of Canada keeps short-term rates low


The Bank of Canada is sticking to its low interest rate policy to continue to help the recovery, even though there is a lot of evidence that the economy is performing better than originally expected.

Most of the five-paragraph statement was devoted to highlighting that not much had changed and that the risks to the global recovery remain elevated. The bank also warned that the strong Canadian dollar and the poor productivity of Canadian firms will slow export growth.

On future intentions, the bank recycled a line used before that any tightening to monetary policy will need to be carefully considered.

The Bank of Canada has kept the overnight rate at 1% (bank prime 3%) since September 2010.

Click here to read the complete article from Julina Beltrame from the Canadian Press.

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