Even as warnings about a potential recession grow louder, the Bank of Canada is expected to announce another hefty interest rate hike on Wednesday, edging the bank closer to the end of one of the fastest monetary policy tightening cycles in its history.
RBC senior economist Nathan Janzen says it’s a coin toss between the Bank of Canada choosing to raise its key interest rate by half a percentage point or three-quarters of a percentage point, though RBC is leaning toward the smaller increase. “It's pretty clear that more aggressive interest rate hikes are still warranted,” Janzen said.
As well as the interest rate decision, the Bank of Canada will also release updated economic projections on Wednesday in its latest quarterly monetary policy report. The central bank's outlook on inflation will be key to its plans for any additional rate hikes to come. As the Bank of Canada raises interest rates to bring inflation back to its two per cent target, officials at the central bank have expressed concern about how high inflation still is and its impact on consumer and business expectations for future inflation.
The good news, however, won’t be enough to dissuade the bank from another sizable rate hike, Janzen said. While there is some division among economists on how severe the impending economic slowdown will be, many economists estimate the chances of a recession have grown.
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Bank of Canada expected to raise interest rates on Wednesday as recession fears growEven as warnings about a potential recession grow louder, the Bank of Canada is expected to announce another hefty interest rate hike on Wednesday, edging the bank closer to the end of one of the fastest monetary policy tightening cycles in its history.
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Bank of Canada expected to raise interest rates on Wednesday as recession fears growEven as warnings about a potential recession grow louder, the Bank of Canada is expected to announce another hefty interest rate hike on Wednesday.
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Bank of Canada expected to raise interest rates as recession fears growEven as warnings about a potential recession grow louder, Bank of Canada is expected to announce another hefty interest rate hike Wednesday.
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Jagmeet Singh says there is ‘no merit’ to expected Bank of Canada interest rate hikeIn a letter addressed to Justin Trudeau, the NDP leader writes that the government can do more to help Canadians weather the inflationary storm.
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Bank of Canada expected to announce another interest rate hike amid recession fears - National | Globalnews.caWednesday's announcement would make it the sixth consecutive time the Bank of Canada raises interest rates this year in response to decades-high inflation.
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