The Bank of Canada has decided to keep its key interest rate at 5% for the third consecutive day to continue its efforts to combat inflation.
The Bank of Canada (BoC) says the country’s economic growth stagnated in the second and third quarters of 2023, that higher interest rates have “significantly” curbed spending and that price pressures have eased.
“This reduction in pressure, coupled with the decline in gasoline prices, contributed to the decline in inflation […]. However, the increase in housing costs has increased, due to faster growth in rents and other housing costs as well as persistently high mortgage interest rates,” we read in a press release.
Although it has decided to keep its key interest rate at 5%, the Bank of Canada said it is “concerned about the risks associated with the inflation outlook” and remains prepared to raise the key rate again “if necessary”.
“The global economy continues to slow and inflation has continued to fall,” the BoC also said.
Recall that since July 12, 2023, the Bank of Canada has decided to keep its key interest rate at 5% after two consecutive quarter-point increases. The next update will be on January 24, 2024.
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Originally posted 2023-12-06 16:22:23.