Bank of Canada stands pat on key interest rate

The Bank of Canada made no change in its key policy interest rate this morning as expected, leaving it at the one per cent level it has been at for the past three years.

The central bank said low interest rates will remain “appropriate” as long as inflation and growth in Canada remain subdued.

The bank noted that the global economy continues to expand, but its “dynamic has moderated,” saying that recent data suggested “slightly less momentum overall” in the U.S. than anticipated.

But it said financial volatility has increased in a number of emerging economies, with the notable exception of China, which it says is still showing “solid” economic growth.

The Bank of Canada also noted that the housing sector has been “slightly stronger than anticipated,” and said household credit growth has continued to slow in the presence of higher mortgage rates.

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