The Bank of Canada will quite likely raise borrowing costs again before summer. Where the central bank’s interest-rate path goes from there will depend on how quickly North America’s leaders decide what they are doing with their three-country trade agreement.
Governor Stephen Poloz and his deputies on the governing council opted to leave the benchmark rate at 1.25 per cent for a second consecutive policy meeting on April 18. Poloz refused to get into the “nuts and bolts” of the debate, but you get the impression they at least considered an increase.
“Inflation is on target and the economy is operating close to potential,” Poloz said in his opening remarks at a press conference in Ottawa. “That statement alone underscored the considerable progress seen in the economy over the past 12 months.
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