July 16, 2024

Canada’s central bank raises interest rates less than expected

Canada’s central bank raises interest rates less than expected

The Bank of Canada raised interest rates by 0.5 percent to 3.75 percent. Experts had expected an increase of 0.75 percent.

Advertising

The essentials in a nutshell

  • The Bank of Canada has raised interest rates to 3.75 percent.
  • The 0.5 percentage point increase was less than analysts had expected.
  • With the increase, the central bank reacted to the growing recession risk.

The Canadian central bank has its key interest rate Increased less than expected. The Bank of Canada announced in Ottawa on Wednesday that the key interest rate will be raised by 0.50 percentage points to 3.75 per cent. Analysts had expected an increase of 0.75 percentage points.

By slowing the pace of interest rate hikes, the central bank may have reacted to the growing recession risk.

“It’s expected economic growth Until the end of the year And stumbles in the first half of next year. This is because the effects of higher interest rates are spreading through the economy,” the central bank said in a statement. Canadian dollar The decision was followed by initial falls against all major currencies.

This is the sixth increase this year

The current increase is the sixth increase this year. At the start of the year, the key interest rate was still at 0.25 percent. Given the persistent risk of inflation, the central bank was open to further interest rate hikes.

There were inflationary pressures Recently weakened. The annual inflation rate fell to 6.9 percent in September from 7.0 percent in the previous month. In June, the rate was still 8.1 percent.

More on the topic:

dollar

See also  Scientists say the rogue comet 2I / Borissov is "the most authentic" in the US ever