Bank of Canada kept Target Interest Rate at 1.00%
18 January 2012
The Bank of Canada (BoC) announced its decision to maintain its target for the overnight rate at 1.00 percent, which has been unchanged since September 2010, when the rate was increased by 25 bps from 0.75 percent. The Bank Rate is correspondingly 1.25 percent and the deposit rate is 0.75 percent. The BoC estimated that the economy grew by 2.4 percent in 2011 and projects that it will grow by 2.0 percent in 2012 and 2.8 percent in 2013. While the BoC continues to highlight significant external downside risks due to the sovereign debt crisis in Europe, the economy is anticipated to return to full capacity by the third quarter of 2013, one quarter earlier than was expected in the October Monetary Policy Report (MPR).