Bank of Canada Maintains Policy Rate

Sep 8, 2021 By MarketDepth

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The Bank of Canada has decided to keep its key interest target on hold at 0.25%. Additionally, it will also maintain its quantitative easing program at a target pace of $2 billion per week.

Economy Recovery Stalls

The Bank announced its decision earlier today, as rising cases of COVID-19 in many regions pose a risk to the strength of the global recovery. Canadian GDP contracted by about 1% in the second quarter, while CPI inflation remained above 3%, as expected. Furthermore, housing market activity has pulled back from its recent high levels, employment rebounded through June and July, and the Bank still expects the economy to continue growing stronger in the second half of 2021, “although the fourth wave of COVID-19 infections and ongoing supply bottlenecks could weigh on the recover.

Next Meeting in October

The Bank also announced that “the next scheduled date for announcing the overnight rate target is October 27, 2021.”