BoC Press Conference: Interest rate announcement

The Bank of Canada today held its target for the overnight rate at 2.25%, with the Bank Rate at 2.5% and the deposit rate at 2.20%. The war in the Middle East has increased volatility in global energy prices and financial markets, and heightened the risks to the global economy. The breadth and duration of the conflict, and hence its economic impacts, are ...

Good morning. I’m pleased to be here with Senior Deputy Governor Carolyn Rogers to discuss today’s monetary policy decision. Today, Governing Council maintained the policy interest rate at 2.25%. We’ve held the policy rate at this level since October. The Canadian economy continues to face heightened uncertainty related to US trade policy and geopolitical risks. Now the war in Iran has added a new layer of uncertainty. Its impact on the global and Canadian economies will depend on how long the conflict lasts and the extent to which it spreads across the Middle East. Inflation in Canada has been close to the 2% target for more than a year. But, as we’ve seen, the war in Iran is causing oil prices to move sharply higher and this will push up inflation in the short term. BANK OF CANADA WILL NOT ALLOW THE EFFECTS OF HIGH ENERGY PRICES TO BECOME PERSISTENT INFLATION - GOVERNOR TIFF MACKLEM BANK OF CANADA WILL NOT ALLOW THE EFFECTS OF HIGH ENERGY PRICES TO BECOME PERSISTENT INFLATION - GOVERNOR TIFF MACKLEM

The Bank of Canada may see little justification to change interest rates, but analysts warn that rising oil price inflation unleashed by the Iran conflict could join the central bank’s list of risks at its meeting on March 18. The Bank has repeatedly maintained that the policy rate of 2.25% is appropriate since setting it there in December. However, ...