Bank of Canada holds current level of policy rate

Tiff Macklem, Governor of Bank of Canada

 

Bank of Canada holds current level of policy rate

 

Jan 26, 2021

Global Korean Post

 

The Bank of Canada  held its target for the overnight rate at the effective lower bound of ¼ percent, with the Bank Rate at ½ percent and the deposit rate at ¼ percent.

The Bank is maintaining its extraordinary forward guidance, reinforced and supplemented by its quantitative easing (QE) program, which continues at its current pace of at least $4 billion per week.

The COVID-19 pandemic continues to take a severe human and economic toll in Canada and around the world.

The earlier-than anticipated arrival of effective vaccines will save lives and livelihoods, and has reduced uncertainty from extreme levels.

Nevertheless, uncertainty is still elevated, and the outlook remains highly conditional on the path of the virus and the timeline for the effective rollout of vaccines.

 

While a second wave of COVID-19 is hurting Canadians now, the economy should rebound strongly later in the year. The Bank is forecasting growth of around 4 percent this year and close to 5 percent in 2022.

 

The next scheduled date for announcing the overnight rate target is March 10, 2021.

 

The next full update of the Bank’s outlook for the economy and inflation, including risks to the projection, will be published in the MPR on April 21, 2021.

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