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Canada  + Cross Border News  + Finance  | 
The Bank of Canada held its key overnight lending rate at 5% on Wednesday

BoC Not Ready to Curb Rate Hikes

The Bank of Canada is not ready to stop increasing interest rates, says its governor.

Tiff Macklem said Friday that it’s too early to curb hikes as the central bank continues its quest to cool demand and return inflation to its 2% target. He made the comments at his end-of-year speech to the Canadian Club in Toronto.

The BoC boss expects inflation declines to be gradual.

“We don’t need to wait until inflation is all the way back to the 2% target to consider easing policy, but it does need to be clearly headed to 2%,” he said.

Macklem’s interest-rate stance differs from that of U.S. Reserve chief Jerome Powell. Earlier this week, Powell said interest rates may have peaked and signalled that the U.S. central bank could be ready to hold the line on further hikes.

“When it’s clear that inflation is on a sustained downward track, we can begin discussing lowering our policy interest rate,” said Macklem. “We have not started having that discussion, because it’s too early to have that discussion.”

The BoC has increased interest rates 10 times since spring 2022.


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About Monte Stewart

Monte Stewart serves as Content Director - Canada for Connect Commercial Real Estate. Based in Vancouver, British Columbia, Monte provides daily news coverage of major Canadian commercial real estate markets, including Vancouver, Toronto, Montreal and Calgary. He has written about the real estate sector for various media outlets and Avison Young since the early 2000s. In addition, he has covered sports, general news and business for several leading wire services and publications, including The Canadian Press, The Associated Press, The Calgary Herald, The Globe and Mail, Research Money, The Daily Oil Bulletin, Natural Gas World and The Toronto Star. Monte is active in his community as a youth basketball coach and raises funds for such charitable causes as Movember.

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