Bank Of Canada Will Keep Interest Rates Low Longer, Says It Underestimated Economy Weakness
OTTAWA - The Bank of Canada is signalling interest rates will need to stay at super-low levels for longer than it previously thought, citing a deterioration in the economy that has reduced inflationary pressures and set back expectations for growth.
As expected, the central bank's policy setting team kept the trendsetting interest rate at one per cent Wednesday, where it has been for almost two-and-a-half years.
But in a mild surprise, the bank went further by issuing a new advisory to Canadians and financial markets that the anticipated need to raise rates in the future is now less imminent.
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