In its regularly scheduled interest rate announcement made on January 24, 2024, the Bank of Canada indicated that, in its view, no change to current rates was needed. Accordingly, the Bank Rate remains at 5.25%.
In the press release announcing its decision, the Bank noted that the economy has slowed and it expects growth in the Canadian economy to remain close to zero during the first quarter of 2024. However, the rate of inflation at the end of 2023 still stood at 3.4%, with shelter costs remaining the biggest contributor to above-target inflation. In the Bank’s view, core measures of inflation are not showing sustained declines. Overall, the Bank expects inflation to remain close to 3% during the first half of this year before gradually easing, returning to the 2% target in 2025.
The press release outlining the reasons for the Bank’s decision can be found at https://www.bankofcanada.ca/2024/01/fad-press-release-2024-01-24/. The Bank’s next interest rate announcement is scheduled to take place on March 6, 2024.
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