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May 24, 2017BANK OF CANADA MONETARY POLICY The Bank of Canada maintained its target for the overnight rate at 0.5 percent with the Bank Rate continuing at 0.75 per cent and the deposit rate at 0.25 per cent.
The Bank of Canada noted that the recent data on global economies has been consistent with their latest projections of improving growth. The global economy is continuing to gain traction and recent developments support the Bank's view that growth will gradually strengthen over the projection period. The Bank views the Canadian economy's adjustment to lower oil prices as largely complete and sees recent economic data as encouraging, including business investment. The Bank noted robust consumer spending and housing, as well as improving labour markets. It was noted that policy measures have not yet had a substantial cooling effect on housing markets and that export growth remains cool, as was expected in the April Monetary Policy Report. The Bank expects growth to moderate some in the second quarter following a very strong first quarter.
CPI inflation was up to 1.6 per cent in April, reflecting declining food prices due to retail competition. The Bank's three measures of core inflation remain below two per cent and wage growth is still subdued, consistent with the Bank's view of ongoing excess capacity in the economy.
The next Monetary Policy Report with an updated outlook for the economy and inflation will be July 12, 2017.
Bank of Canada
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