As expected, the Bank of Canada kept its benchmark interest rate unchanged at 1.75 per cent.
Since mid-2017, the BoC has raised its key rate five times in its attempt to keep inflation between one and three per cent annually. The bank last raised its rate in October, before deciding to do nothing in December and then again today.
The bank’s rate affects consumers by raising or lowering the rates that Canadian borrowers and savers get for lines of credit, savings accounts, and variable-rate mortgages.
But what should really be worry Canadians is that the bank downgraded its expectations for Canada’s economy this year. There are ample signs of trouble- a 25 per cent plunge in the price of oil since October has hit the economy which is forecasted to grow just 1.7 per cent growth this year down from an expected 2.1 per cent growth.
The bank has not ruled out interest rates hikes in the near future.
As a result of the latest interest rate announcement, the loonie gained about a third of a cent to 75.73 cents US. -CINEWS