4 Dec 2013
BoC maintains interest rate at 1% in December
FXstreet.com (Łódź) - As expected, the Bank of Canada decided to maintain its target for the overnight rate unchanged at 1% at its December monetary policy meeting.
In a statement released after the decision was made known, the BoC said that the global economy continued to improve at a modest pace, and pointed out that US growth proved stronger than projected. Canadian GDP Q3 growth also beat expectations at 2.7%, but “its composition does not yet indicate a rebalancing towards exports and investment.”
The central bank took note of the further CPI fall below the 2% target and said that “downside risks to inflation appear to be greater.” It also added that “core inflation is being held down by significant excess supply and by the effects of heightened competition in the retail sector, which look to be more persistent than anticipated.”
Finally, the BoC stated that “the balance of risks remains within the zone articulated in October”, therefore “the substantial monetary policy stimulus currently in place remains appropriate.”
In a statement released after the decision was made known, the BoC said that the global economy continued to improve at a modest pace, and pointed out that US growth proved stronger than projected. Canadian GDP Q3 growth also beat expectations at 2.7%, but “its composition does not yet indicate a rebalancing towards exports and investment.”
The central bank took note of the further CPI fall below the 2% target and said that “downside risks to inflation appear to be greater.” It also added that “core inflation is being held down by significant excess supply and by the effects of heightened competition in the retail sector, which look to be more persistent than anticipated.”
Finally, the BoC stated that “the balance of risks remains within the zone articulated in October”, therefore “the substantial monetary policy stimulus currently in place remains appropriate.”