With job and inflation numbers on the increase, the Bank of Canada is expected to reveal what will happen to its trendsetting interest rate today.
Since the outbreak of the pandemic in March 2020, the central bank’s key interest rate goal has remained at a record low of 0.25 percent, and it is unlikely to be changed as part of the last planned rate call for 2021.
The bank has stated that it will not raise the rate until the economy has recovered sufficiently to handle it.
The economy grew at an annual rate of 5.4 per cent in the third quarter, almost in line with the bank’s expectations, and job gains in November lowered the unemployment rate to within 0.3 percentage points of what was recorded in February 2020 just before the pandemic.
At the same time, inflation remains above the central bank’s target range of one and three per cent.
Although senior bank officials have said a rate hike could happen as early as April, the updated economic indicators released last week by Statistics Canada had some economists saying a rate increase in January couldn’t be ruled out.