Bank of Canada Goverrnor, Stephen Poloz said they'll be no interest rate increase for now, due to uncertainty over NAFTA trade talks (Bloomberg via CBC)

Canada: no hike in interest rate- for now

Share

After a lengthy and almost unprecedented level of low interest rates, Canada’s central bank had begun a slow hike in rates. This comes as the economy begins to recover and inflation has risen to about 3%. However, the Central bank has decided to hold its rate steady at 1.5 per cent

The Central Bank rate affects what consumers pay at commercial banks for loans, mortgages, and other financial services.

The odd clash of architectural styles of the Bank of Canada, headquarters in the national capital , Ottawa. (Bank of Canada)

An increase in the central bank rate comes in an effort to cool the economy and inflation, while a decrease is warranted to stimulate the economy.

After near record lows in 2008 and 2009 of 0.2 and 0.5 per cent during a serious near world-wide economic downturn, the rate was increased to 1.0 per cent, then lowered again in 2010 to cope with a oil crisis.

Since then there have been tiny incremental steps to 1.5 per cent, where it will remain for the time being.

Since the economy is doing well and inflation is up, there was speculation that the Central bank would increase it’s rate this week but Bank of Canada governor Stephen Poloz said uncertainty over the North American Free Trade Talks has suggested they should opt for caution for the moment.

A trade dispute or substantial U.S tariffs could result in the bank having to reverse course if it increased rates now.

Historic look at Central Bank lending rates.
(Bank of Canada- Canadian Press via CBC)

Within the Group of Seven, (G7) countries, ony the U.S. currently has a higher interest rate than Canada.

It is generally expected however, that Poloz will announce an increase on October 24 when it releases its next quarterly forecast.

Argentina currently has the world’s highest interest rate at 60% followed by Turkey at 17.75 %, and then Mexico at 7.75%.  Australia, Canada, and South Korea are all at 1.5%.   The U.K is at 0.75%, while EU countries are at 0.0%

Additional information-sources

Share
Categories: Economy, International, Politics, Society
Tags: , , ,

Do you want to report an error or a typo? Click here!

@*@ Comments

Leave a Reply

Note: By submitting your comments, you acknowledge that Radio Canada International has the right to reproduce, broadcast and publicize those comments or any part thereof in any manner whatsoever. Radio Canada International does not endorse any of the views posted. Your comments will be pre-moderated and published if they meet netiquette guidelines.

Netiquette »

When you express your personal opinion in an online forum, you must be as courteous as if you were speaking with someone face-to-face. Insults and personal attacks will not be tolerated. To disagree with an opinion, an idea or an event is one thing, but to show disrespect for other people is quite another. Great minds don’t always think alike—and that’s precisely what makes online dialogue so interesting and valuable.

Netiquette is the set of rules of conduct governing how you should behave when communicating via the Internet. Before you post a message to a blog or forum, it’s important to read and understand these rules. Otherwise, you may be banned from posting.

  1. RCInet.ca’s online forums are not anonymous. Users must register, and give their full name and place of residence, which are displayed alongside each of their comments. RCInet.ca reserves the right not to publish comments if there is any doubt as to the identity of their author.
  2. Assuming the identity of another person with intent to mislead or cause harm is a serious infraction that may result in the offender being banned.
  3. RCInet.ca’s online forums are open to everyone, without regard to age, ethnic origin, religion, gender or sexual orientation.
  4. Comments that are defamatory, hateful, racist, xenophobic, sexist, or that disparage an ethnic origin, religious affiliation or age group will not be published.
  5. In online speak, writing in ALL CAPS is considered yelling, and may be interpreted as aggressive behaviour, which is unpleasant for the people reading. Any message containing one or more words in all caps (except for initialisms and acronyms) will be rejected, as will any message containing one or more words in bold, italic or underlined characters.
  6. Use of vulgar, obscene or objectionable language is prohibited. Forums are public places and your comments could offend some users. People who use inappropriate language will be banned.
  7. Mutual respect is essential among users. Insulting, threatening or harassing another user is prohibited. You can express your disagreement with an idea without attacking anyone.
  8. Exchanging arguments and opposing views is a key component of healthy debate, but it should not turn into a dialogue or private discussion between two users who address each other without regard for the other participants. Messages of this type will not be posted.
  9. Radio Canada International publishes contents in five languages. The language used in the forums has to be the same as the contents we publish or in one of the two official languages, English or French. The usage of other languages, with the exception of some words, is forbidden. Messages that are off-topic will not be published.
  10. Making repetitive posts disrupts the flow of discussions and will not be tolerated.
  11. Adding images or any other type of file to comments is forbidden. Including hyperlinks to other websites is allowed, as long as they comply with netiquette. Radio Canada International  is in no way responsible for the content of such sites, however.
  12. Copying and pasting text written by someone else, even if you credit the author, is unacceptable if that text makes up the majority of your comment.
  13. Posting any type of advertising or call to action, in any form, to Radio Canada International  forums is prohibited.
  14. All comments and other types of content are moderated before publication. Radio Canada International  reserves the right to refuse any comment for publication.
  15. Radio Canada International  reserves the right to close a forum at any time, without notice.
  16. Radio Canada International  reserves the right to amend this code of conduct (netiquette) at any time, without notice.
  17. By participating in its online forums, you allow Radio Canada International to publish your comments on the web for an indefinite time. This also implies that these messages will be indexed by Internet search engines.
  18. Radio Canada International has no obligation to remove your messages from the web if one day you request it. We invite you to carefully consider your comments and the consequences of their posting.

Your email address will not be published. Required fields are marked *

 characters available

*