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The Bank of Canada maintains policy rate
As anticipated, the Bank of Canada left its overnight target rate unchanged at 5.00% during its April 10th, 2024 meeting. This marks the 6th consecutive rate hold over the last 9 months (the last change was +0.25% on July 12, 2023).
While the next rate change is expected to be downward, the timing remains uncertain and will be dependent on upcoming economic data releases.
With respect to inflation, the Bank said, “While inflation is still too high and risks remain, CPI and core inflation have eased further in recent months. The Council will be looking for evidence that this downward momentum is sustained.” In its latest forecast, the Bank said it expects “CPI inflation to be close to 3% during the first half of this year, move below 2.5% in the second half, and reach the 2% inflation target in 2025.”
On the labour market front, the Bank noted that “a broad range of indicators suggest that labour market conditions continue to ease…” and “there are some recent signs that wage pressures are moderating.”
In line with most economic forecasts, we anticipate the Bank of Canada will begin cutting rates by the middle or second half of this year. The next rate announcement is scheduled for June 5, 2024.
Wondering how the Bank of Canada rate announcement could impact your mortgage options? If you are interested in discussing your options, please reach out to an Outline advisor today: https://www.outline.
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[Click Here to Read the Full Bank of Canada Announcement]
