This morning, March 7, 2018, the Bank of Canada released a press release stating that they would not increase their overnight rate.
After the rate hike to 1.25% in January 2018, none of the experts surveyed at Bloomberg thought there would be another increase. Those predictions proved true today.
“While the economic outlook is expected to warrant higher interest rates over time, some continued monetary policy accommodation will likely be needed to keep the economy operating close to potential and inflation on target” the press release continued.
This announcement comes almost two months after the most recent interest rate increase in January 2018, which was the third increase since June of 2017.
This marks the second of eight statements from the Bank of Canada regarding interest rates for 2018. The remaining six will be released over the course of 2018, with the next scheduled to release on April 18, 2018.
The Bank confirms that the inflation rate is “running close to the 2 per cent target” and that wage growth has “firmed.”
They also note that the recent trade talks have an “important and growing source of uncertainty for… Canadian outlooks,” As NAFTA talks wrapped up this week in Mexico City, the results will show themselves in time.
For those of you with a variable term mortgage, or those considering one, you can breathe a little easier knowing that experts are predicting at most one more interest rate increase for the rest of the year.