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45bf9772d751-0 | The Bank of Canada today increased its target for the overnight rate to 4½%, with the Bank Rate at 4¾% and the deposit rate at 4½%. The Bank is also continuing its policy of quantitative tightening.
Global inflation remains high and broad-based. Inflation is coming down in many countries, largely reflecting lower energy prices as well as improvements in global supply chains. In the United States and Europe, economies are slowing but proving more resilient than was expected at the time of the Bank’s October Monetary Policy Report (MPR). China’s abrupt lifting of COVID-19 restrictions has prompted an upward revision to the growth forecast for China and poses an upside risk to commodity prices. Russia’s war on Ukraine remains a significant source of uncertainty. Financial conditions remain restrictive but have eased since October, and the Canadian dollar has been relatively stable against the US dollar.
The Bank estimates the global economy grew by about 3½% in 2022, and will slow to about 2% in 2023 and 2½% in 2024. This projection is slightly higher than October’s.
In Canada, recent economic growth has been stronger than expected and the economy remains in excess demand. Labour markets are still tight: the unemployment rate is near historic lows and businesses are reporting ongoing difficulty finding workers. However, there is growing evidence that restrictive monetary policy is slowing activity, especially household spending. Consumption growth has moderated from the first half of 2022 and housing market activity has declined substantially. As the effects of interest rate increases continue to work through the economy, spending on consumer services and business investment are expected to slow. Meanwhile, weaker foreign demand will likely weigh on exports. This overall slowdown in activity will allow supply to catch up with demand.
The Bank estimates Canada’s economy grew by 3.6% in 2022, slightly stronger than was projected in October. Growth is expected to stall through the middle of 2023, picking up later in the year. The Bank expects GDP growth of about 1% in 2023 and about 2% in 2024, little changed from the October outlook.
Inflation has declined from 8.1% in June to 6.3% in December, reflecting lower gasoline prices and, more recently, moderating prices for durable goods. Despite this progress, Canadians are still feeling the hardship of high inflation in their essential household expenses, with persistent price increases for food and shelter. Short-term inflation expectations remain elevated. Year-over-year measures of core inflation are still around 5%, but 3-month measures of core inflation have come down, suggesting that core inflation has peaked.
Inflation is projected to come down significantly this year. Lower energy prices, improvements in global supply conditions, and the effects of higher interest rates on demand are expected to bring CPI inflation down to around 3% in the middle of this year and back to the 2% target in 2024.
With persistent excess demand putting continued upward pressure on many prices, Governing Council decided to increase the policy interest rate by a further 25 basis points. The Bank’s ongoing program of quantitative tightening is complementing the restrictive stance of the policy rate. If economic developments evolve broadly in line with the MPR outlook, Governing Council expects to hold the policy rate at its current level while it assesses the impact of the cumulative interest rate increases. Governing Council is prepared to increase the policy rate further if needed to return inflation to the 2% target, and remains resolute in its commitment to restoring price stability for Canadians.
Information note
The next scheduled date for announcing the overnight rate target is March 8, 2023. The Bank will publish its next full outlook for the economy and inflation, including risks to the projection, in the MPR on April 12, 2023. | https://www.bankofcanada.ca/2023/01/fad-press-release-2023-01-25/ | ca | 2023-01-25T00:00:00+00:00 | January 25 2023 - Statement | statements | false | null | 2023-03-29T12:31:21+00:00 |
a31166a00d2c-0 | The Bank of Canada today increased its target for the overnight rate to 3¾%, with the Bank Rate at 4% and the deposit rate at 3¾%. The Bank is also continuing its policy of quantitative tightening.
Inflation around the world remains high and broadly based. This reflects the strength of the global recovery from the pandemic, a series of global supply disruptions, and elevated commodity prices, particularly for energy, which have been pushed up by Russia’s attack on Ukraine. The strength of the US dollar is adding to inflationary pressures in many countries. Tighter monetary policies aimed at controlling inflation are weighing on economic activity around the world. As economies slow and supply disruptions ease, global inflation is expected to come down.
In the United States, labour markets remain very tight even as restrictive financial conditions are slowing economic activity. The Bank projects no growth in the US economy through most of next year. In the euro area, the economy is forecast to contract in the quarters ahead, largely due to acute energy shortages. China’s economy appears to have picked up after the recent round of pandemic lockdowns, although ongoing challenges related to its property market will continue to weigh on growth. Overall, the Bank projects that global growth will slow from 3% in 2022 to about 1½% in 2023, and then pick back up to roughly 2½% in 2024. This is a slower pace of growth than was projected in the Bank’s July Monetary Policy Report (MPR).
In Canada, the economy continues to operate in excess demand and labour markets remain tight. The demand for goods and services is still running ahead of the economy’s ability to supply them, putting upward pressure on domestic inflation. Businesses continue to report widespread labour shortages and, with the full reopening of the economy, strong demand has led to a sharp rise in the price of services.
The effects of recent policy rate increases by the Bank are becoming evident in interest-sensitive areas of the economy: housing activity has retreated sharply, and spending by households and businesses is softening. Also, the slowdown in international demand is beginning to weigh on exports. Economic growth is expected to stall through the end of this year and the first half of next year as the effects of higher interest rates spread through the economy. The Bank projects GDP growth will slow from 3¼% this year to just under 1% next year and 2% in 2024.
In the last three months, CPI inflation has declined from 8.1% to 6.9%, primarily due to a fall in gasoline prices. However, price pressures remain broadly based, with two-thirds of CPI components increasing more than 5% over the past year. The Bank’s preferred measures of core inflation are not yet showing meaningful evidence that underlying price pressures are easing. Near-term inflation expectations remain high, increasing the risk that elevated inflation becomes entrenched.
The Bank expects CPI inflation to ease as higher interest rates help rebalance demand and supply, price pressures from global supply disruptions fade, and the past effects of higher commodity prices dissipate. CPI inflation is projected to move down to about 3% by the end of 2023, and then return to the 2% target by the end of 2024.
Given elevated inflation and inflation expectations, as well as ongoing demand pressures in the economy, the Governing Council expects that the policy interest rate will need to rise further. Future rate increases will be influenced by our assessments of how tighter monetary policy is working to slow demand, how supply challenges are resolving, and how inflation and inflation expectations are responding. Quantitative tightening is complementing increases in the policy rate. We are resolute in our commitment to restore price stability for Canadians and will continue to take action as required to achieve the 2% inflation target.
Information note
The next scheduled date for announcing the overnight rate target is December 7, 2022. The Bank will publish its next full outlook for the economy and inflation, including risks to the projection, in the MPR on January 25, 2023. | https://www.bankofcanada.ca/2022/10/fad-press-release-2022-10-26/ | ca | 2022-10-26T00:00:00+00:00 | October 26 2022 - Statement | statements | false | null | 2023-03-29T12:31:20+00:00 |
d9c8a93da2f8-0 | The Bank of Canada today increased its target for the overnight rate to 3¼%, with the Bank Rate at 3½% and the deposit rate at 3¼%. The Bank is also continuing its policy of quantitative tightening.
The global and Canadian economies are evolving broadly in line with the Bank’s July projection. The effects of COVID-19 outbreaks, ongoing supply disruptions, and the war in Ukraine continue to dampen growth and boost prices.
Global inflation remains high and measures of core inflation are moving up in most countries. In response, central banks around the world continue to tighten monetary policy. Economic activity in the United States has moderated, although the US labour market remains tight. China is facing ongoing challenges from COVID shutdowns. Commodity prices have been volatile: oil, wheat and lumber prices have moderated while natural gas prices have risen.
In Canada, CPI inflation eased in July to 7.6% from 8.1% because of a drop in gasoline prices. However, inflation excluding gasoline increased and data indicate a further broadening of price pressures, particularly in services. The Bank’s core measures of inflation continued to move up, ranging from 5% to 5.5% in July. Surveys suggest that short-term inflation expectations remain high. The longer this continues, the greater the risk that elevated inflation becomes entrenched.
The Canadian economy continues to operate in excess demand and labour markets remain tight. Canada’s GDP grew by 3.3% in the second quarter. While this was somewhat weaker than the Bank had projected, indicators of domestic demand were very strong – consumption grew by about 9½% and business investment was up by close to 12%. With higher mortgage rates, the housing market is pulling back as anticipated, following unsustainable growth during the pandemic. The Bank continues to expect the economy to moderate in the second half of this year, as global demand weakens and tighter monetary policy here in Canada begins to bring demand more in line with supply.
Given the outlook for inflation, the Governing Council still judges that the policy interest rate will need to rise further. Quantitative tightening is complementing increases in the policy rate. As the effects of tighter monetary policy work through the economy, we will be assessing how much higher interest rates need to go to return inflation to target. The Governing Council remains resolute in its commitment to price stability and will continue to take action as required to achieve the 2% inflation target.
Information note
The next scheduled date for announcing the overnight rate target is October 26, 2022. The Bank will publish its next full outlook for the economy and inflation, including risks to the projection, in the MPR at the same time. | https://www.bankofcanada.ca/2022/09/fad-press-release-2022-09-07/ | ca | 2022-09-07T00:00:00+00:00 | September 07 2022 - Statement | statements | false | null | 2023-03-29T12:31:19+00:00 |
4614bd752efb-0 | The Bank of Canada today increased its target for the overnight rate to 2½%, with the Bank Rate at 2¾% and the deposit rate at 2½%. The Bank is also continuing its policy of quantitative tightening (QT).
Inflation in Canada is higher and more persistent than the Bank expected in its April Monetary Policy Report (MPR), and will likely remain around 8% in the next few months. While global factors such as the war in Ukraine and ongoing supply disruptions have been the biggest drivers, domestic price pressures from excess demand are becoming more prominent. More than half of the components that make up the CPI are now rising by more than 5%. With this broadening of price pressures, the Bank’s core measures of inflation have moved up to between 3.9% and 5.4%. Also, surveys indicate more consumers and businesses are expecting inflation to be higher for longer, raising the risk that elevated inflation becomes entrenched in price- and wage-setting. If that occurs, the economic cost of restoring price stability will be higher.
Global inflation is higher, reflecting the impact of the Russian invasion of Ukraine, ongoing supply constraints, and strong demand. Many central banks are tightening monetary policy to combat inflation, and the resulting tighter financial conditions are moderating economic growth. In the United States, high inflation and rising interest rates are contributing to a slowdown in domestic demand. China’s economy is being held back by waves of restrictive measures to contain COVID-19 outbreaks. Oil prices remain high and volatile. The Bank now expects global economic growth to slow to about 3½% this year and 2% in 2023 before strengthening to 3% in 2024.
Further excess demand has built up in the Canadian economy. Labour markets are tight with a record low unemployment rate, widespread labour shortages, and increasing wage pressures. With strong demand, businesses are passing on higher input and labour costs by raising prices. Consumption is robust, led by a rebound in spending on hard-to-distance services. Business investment is solid and exports are being boosted by elevated commodity prices. The Bank estimates that GDP grew by about 4% in the second quarter. Growth is expected to slow to about 2% in the third quarter as consumption growth moderates and housing market activity pulls back following unsustainable strength during the pandemic.
The Bank expects Canada’s economy to grow by 3½% in 2022, 1¾% in 2023, and 2½% in 2024. Economic activity will slow as global growth moderates and tighter monetary policy works its way through the economy. This, combined with the resolution of supply disruptions, will bring demand and supply back into balance and alleviate inflationary pressures. Global energy prices are also projected to decline. The July outlook has inflation starting to come back down later this year, easing to about 3% by the end of next year and returning to the 2% target by the end of 2024.
With the economy clearly in excess demand, inflation high and broadening, and more businesses and consumers expecting high inflation to persist for longer, the Governing Council decided to front-load the path to higher interest rates by raising the policy rate by 100 basis points today. The Governing Council continues to judge that interest rates will need to rise further, and the pace of increases will be guided by the Bank’s ongoing assessment of the economy and inflation. Quantitative tightening continues and is complementing increases in the policy interest rate. The Governing Council is resolute in its commitment to price stability and will continue to take action as required to achieve the 2% inflation target.
Information note
The next scheduled date for announcing the overnight rate target is September 7, 2022. The Bank will publish its next full outlook for the economy and inflation, including risks to the projection, in the MPR on October 26, 2022. | https://www.bankofcanada.ca/2022/07/fad-press-release-2022-07-13/ | ca | 2022-07-13T00:00:00+00:00 | July 13 2022 - Statement | statements | false | null | 2023-03-29T12:31:19+00:00 |
8d2ea708eebf-0 | The Bank of Canada today increased its target for the overnight rate to 1%, with the Bank Rate at 1¼% and the deposit rate at 1%. The Bank is also ending reinvestment and will begin quantitative tightening (QT), effective April 25. Maturing Government of Canada bonds on the Bank’s balance sheet will no longer be replaced and, as a result, the size of the balance sheet will decline over time.
Russia’s ongoing invasion of Ukraine is causing unimaginable human suffering and new economic uncertainty. Price spikes in oil, natural gas and other commodities are adding to inflation around the world. Supply disruptions resulting from the war are also exacerbating ongoing supply constraints and weighing on activity. These factors are the primary drivers of a substantial upward revision to the Bank’s outlook for inflation in Canada.
The war in Ukraine is disrupting the global recovery, just as most economies are emerging from the impact of the Omicron variant of COVID-19. European countries are more directly impacted by confidence effects and supply dislocations caused by the war. China’s economy is facing new COVID outbreaks and an ongoing correction in its property market. In the United States, domestic demand remains very strong and the US Federal Reserve has clearly indicated its resolve to use its monetary policy tools to control inflation. As policy stimulus is withdrawn, US growth is expected to moderate to a pace more in line with potential growth. Global financial conditions have tightened and volatility has increased. The Bank now forecasts global growth of about 3½% this year, 2½% in 2023 and 3¼% in 2024.
In Canada, growth is strong and the economy is moving into excess demand. Labour markets are tight, and wage growth is back to its pre-pandemic pace and rising. Businesses increasingly report they are having difficulty meeting demand, and are able to pass on higher input costs by increasing prices. While the COVID-19 virus continues to mutate and circulate, high rates of vaccination have reduced its health and economic impacts. Growth looks to have been stronger in the first quarter than projected in January and is likely to pick up in the second quarter. Consumer spending is strengthening with the lifting of pandemic containment measures. Exports and business investment will continue to recover, supported by strong foreign demand and high commodity prices. Housing market activity, which has been exceptionally high, is expected to moderate.
The Bank forecasts that Canada’s economy will grow by 4¼% this year before slowing to 3¼% in 2023 and 2¼% in 2024. Robust business investment, labour productivity growth and higher immigration will add to the economy’s productive capacity, while higher interest rates should moderate growth in domestic demand.
CPI inflation in Canada is 5.7%, above the Bank’s forecast in its January Monetary Policy Report (MPR). Inflation is being driven by rising energy and food prices and supply disruptions, in combination with strong global and domestic demand. Core measures of inflation have all moved higher as price pressures broaden. CPI inflation is now expected to average almost 6% in the first half of 2022 and remain well above the control range throughout this year. It is then expected to ease to about 2½% in the second half of 2023 and return to the 2% target in 2024. There is an increasing risk that expectations of elevated inflation could become entrenched. The Bank will use its monetary policy tools to return inflation to target and keep inflation expectations well-anchored.
With the economy moving into excess demand and inflation persisting well above target, the Governing Council judges that interest rates will need to rise further. The policy interest rate is the Bank’s primary monetary policy instrument, and quantitative tightening will complement increases in the policy rate. The timing and pace of further increases in the policy rate will be guided by the Bank’s ongoing assessment of the economy and its commitment to achieving the 2% inflation target.
Information note
The next scheduled date for announcing the overnight rate target is June 1, 2022. The Bank will publish its next full outlook for the economy and inflation, including risks to the projection, in the MPR on July 13, 2022.
A market notice providing operational details for QT will be published this morning on the Bank’s web site. | https://www.bankofcanada.ca/2022/04/fad-press-release-2022-04-13/ | ca | 2022-04-13T00:00:00+00:00 | April 13 2022 - Statement | statements | false | null | 2023-03-29T12:31:18+00:00 |
d13ecfd674fa-0 | The Bank of Canada today held its target for the overnight rate at the effective lower bound of ¼ percent, with the Bank Rate at ½ percent and the deposit rate at ¼ percent. The Bank’s extraordinary forward guidance on the path for the overnight rate is being maintained. The Bank is continuing its reinvestment phase, keeping its overall holdings of Government of Canada bonds roughly constant.
The global economy continues to recover from the effects of the COVID-19 pandemic. Economic growth in the United States has accelerated, led by consumption, while growth in some other regions is moderating after a strong third quarter. Inflation has increased further in many countries, reflecting strong demand for goods amid ongoing supply disruptions. The new Omicron COVID-19 variant has prompted a tightening of travel restrictions in many countries and a decline in oil prices, and has injected renewed uncertainty. Accommodative financial conditions are still supporting economic activity.
Canada’s economy grew by about 5½ percent in the third quarter, as expected. Together with a downward revision to the second quarter, this brings the level of GDP to about 1½ percent below its level in the last quarter of 2019, before the pandemic began. Third-quarter growth was led by a rebound in consumption, particularly services, as restrictions were further eased and higher vaccination rates improved confidence. Persistent supply bottlenecks continued to inhibit growth in other components of GDP, including non-commodity exports and business investment.
Recent economic indicators suggest the economy had considerable momentum into the fourth quarter. This includes broad-based job gains in recent months that have brought the employment rate essentially back to its pre-pandemic level. Job vacancies remain elevated and wage growth has also picked up. Housing activity had been moderating, but appears to be regaining strength, notably in resales. The devastating floods in British Columbia and uncertainties arising from the Omicron variant could weigh on growth by compounding supply chain disruptions and reducing demand for some services.
CPI inflation is elevated and the impact of global supply constraints is feeding through to a broader range of goods prices. The effects of these constraints on prices will likely take some time to work their way through, given existing supply backlogs. Gasoline prices, which had been a major factor pushing up CPI inflation, have recently declined. Meanwhile, core measures of inflation are little changed since September. The Bank continues to expect CPI inflation to remain elevated in the first half of 2022 and ease back towards 2 percent in the second half of the year. The Bank is closely watching inflation expectations and labour costs to ensure that the forces pushing up prices do not become embedded in ongoing inflation.
The Governing Council judges that in view of ongoing excess capacity, the economy continues to require considerable monetary policy support. We remain committed to holding the policy interest rate at the effective lower bound until economic slack is absorbed so that the 2 percent inflation target is sustainably achieved. In the Bank’s October projection, this happens sometime in the middle quarters of 2022. We will provide the appropriate degree of monetary policy stimulus to support the recovery and achieve the inflation target.
Information note
The next scheduled date for announcing the overnight rate target is January 26, 2022. The Bank will publish its full outlook for the economy and inflation, including risks to the projection, in the Monetary Policy Report at the same time. | https://www.bankofcanada.ca/2021/12/fad-press-release-2021-12-08/ | ca | 2021-12-08T00:00:00+00:00 | December 08 2021 - Statement | statements | false | null | 2023-03-29T12:31:17+00:00 |
ecf6bb727412-0 | The Bank of Canada today held its target for the overnight rate at the effective lower bound of ¼ percent, with the Bank Rate at ½ percent and the deposit rate at ¼ percent. The Bank’s extraordinary forward guidance on the path for the overnight rate is being maintained. The Bank is ending quantitative easing (QE) and moving into the reinvestment phase, during which it will purchase Government of Canada bonds solely to replace maturing bonds.
The global economic recovery from the COVID-19 pandemic is progressing. Vaccines are proving highly effective against the virus, although their availability and distribution globally remain uneven and COVID variants pose risks to health and economic activity. In the face of strong global demand for goods, pandemic-related disruptions to production and transportation are constraining growth. Inflation rates have increased in many countries, boosted by these supply bottlenecks and by higher energy prices. While bond yields have risen in recent weeks, financial conditions remain accommodative and continue to support economic activity.
The Bank projects global GDP will grow by 6½ percent in 2021 – a strong pace but less than projected in the July Monetary Policy Report (MPR) – and by 4¼ percent in 2022 and about 3½ percent in 2023.
In Canada, robust economic growth has resumed, following a pause in the second quarter. Strong employment gains in recent months were concentrated in hard-to-distance sectors and among workers most affected by lockdowns. This has significantly reduced the very uneven impact of the pandemic on workers. As the economy reopens, it is taking time for workers to find the right jobs and for employers to hire people with the right skills. This is contributing to labour shortages in certain sectors, even as slack remains in the overall labour market.
The Bank now forecasts Canada’s economy will grow by 5 percent this year before moderating to 4¼ percent in 2022 and 3¾ percent in 2023. Demand is expected to be supported by strong consumption and business investment, and a rebound in exports as the US economy continues to recover. Housing activity has moderated, but is expected to remain elevated. On the supply side, shortages of manufacturing inputs, transportation bottlenecks, and difficulties in matching jobs to workers are limiting the economy’s productive capacity. Although the impact and persistence of these supply factors are hard to quantify, the output gap is likely to be narrower than the Bank had forecast in July.
The recent increase in CPI inflation was anticipated in July, but the main forces pushing up prices – higher energy prices and pandemic-related supply bottlenecks – now appear to be stronger and more persistent than expected. Core measures of inflation have also risen, but by less than the CPI. The Bank now expects CPI inflation to be elevated into next year, and ease back to around the 2 percent target by late 2022. The Bank is closely watching inflation expectations and labour costs to ensure that the temporary forces pushing up prices do not become embedded in ongoing inflation.
The Governing Council judges that in view of ongoing excess capacity, the economy continues to require considerable monetary policy support. We remain committed to holding the policy interest rate at the effective lower bound until economic slack is absorbed so that the 2 percent inflation target is sustainably achieved. In the Bank’s projection, this happens sometime in the middle quarters of 2022. In light of the progress made in the economic recovery, the Governing Council has decided to end quantitative easing and keep its overall holdings of Government of Canada bonds roughly constant.
We will continue to provide the appropriate degree of monetary policy stimulus to support the recovery and achieve the inflation target.
Information notes
A market notice outlining details of the reinvestment phase will be published on the Bank’s web site at 10:30 am ET today.
The next scheduled date for announcing the overnight rate target is December 8, 2021. The next full update of the Bank’s outlook for the economy and inflation, including risks to the projection, will be published in the MPR on January 26, 2022. | https://www.bankofcanada.ca/2021/10/fad-press-release-2021-10-27/ | ca | 2021-10-27T00:00:00+00:00 | October 27 2021 - Statement | statements | false | null | 2023-03-29T12:31:16+00:00 |
f77524e9bcdb-0 | The Bank of Canada today held its target for the overnight rate at the effective lower bound of ¼ percent, with the Bank Rate at ½ percent and the deposit rate at ¼ percent. The Bank is maintaining its extraordinary forward guidance on the path for the overnight rate. This is reinforced and supplemented by the Bank’s quantitative easing (QE) program, which is being maintained at a target pace of $2 billion per week.
The global economic recovery continued through the second quarter, led by strong US growth, and had solid momentum heading into the third quarter. However, supply chain disruptions are restraining activity in some sectors and rising cases of COVID-19 in many regions pose a risk to the strength of the global recovery. Financial conditions remain highly accommodative.
In Canada, GDP contracted by about 1 percent in the second quarter, weaker than anticipated in the Bank’s July Monetary Policy Report (MPR). This largely reflects a contraction in exports, due in part to supply chain disruptions, especially in the auto sector. Housing market activity pulled back from recent high levels, largely as expected. Consumption, business investment and government spending all contributed positively to growth, with domestic demand growing at more than 3 percent. Employment rebounded through June and July, with hard-to-distance sectors hiring as public health restrictions eased. This is reducing unevenness in the labour market, although considerable slack remains and some groups – particularly low-wage workers – are still disproportionately affected. The Bank continues to expect the economy to strengthen in the second half of 2021, although the fourth wave of COVID-19 infections and ongoing supply bottlenecks could weigh on the recovery.
CPI inflation remains above 3 percent as expected, boosted by base-year effects, gasoline prices, and pandemic-related supply bottlenecks. These factors pushing up inflation are expected to be transitory, but their persistence and magnitude are uncertain and will be monitored closely. Wage increases have been moderate to date, and medium-term inflation expectations remain well-anchored. Core measures of inflation have risen, but by less than the CPI.
The Governing Council judges that the Canadian economy still has considerable excess capacity, and that the recovery continues to require extraordinary monetary policy support. We remain committed to holding the policy interest rate at the effective lower bound until economic slack is absorbed so that the 2 percent inflation target is sustainably achieved. In the Bank’s July projection, this happens in the second half of 2022. The Bank's QE program continues to reinforce this commitment and keep interest rates low across the yield curve. Decisions regarding future adjustments to the pace of net bond purchases will be guided by Governing Council's ongoing assessment of the strength and durability of the recovery. We will continue to provide the appropriate degree of monetary policy stimulus to support the recovery and achieve the inflation objective.
Information note
The next scheduled date for announcing the overnight rate target is October 27, 2021. The next full update of the Bank’s outlook for the economy and inflation, including risks to the projection, will be published in the MPR at the same time. | https://www.bankofcanada.ca/2021/09/fad-press-release-2021-09-08/ | ca | 2021-09-08T00:00:00+00:00 | September 08 2021 - Statement | statements | false | null | 2022-11-03T12:31:19+00:00 |
60447fb137f4-0 | The Bank of Canada today published its 2022 schedule for policy interest rate announcements and the release of the quarterly Monetary Policy Report. It also reconfirmed the scheduled interest rate announcement dates for the remainder of this year.
The Bank also published its schedule for the release of the Business Outlook Survey and the Canadian Survey of Consumer Expectations.
The scheduled dates for the interest rate announcements for 2022 are as follows:
Wednesday, January 26*
Wednesday, March 2
Wednesday, April 13*
Wednesday, June 1
Wednesday, July 13*
Wednesday, September 7
Wednesday, October 26*
Wednesday, December 7
The scheduled dates for the interest rate announcements from September 2021 through December 2021 are reconfirmed as follows:
Wednesday, September 8
Wednesday, October 27*
Wednesday, December 8
*Monetary Policy Report published
All interest rate announcements will be made at 10:00 (ET), and the Monetary Policy Report will be published concurrently with the January, April, July and October rate announcements.
The scheduled dates for the release of the 2022 issues of the Business Outlook Survey and Canadian Survey of Consumer Expectations are as follows:
Monday, January 17
Monday, April 4
Monday, July 4
Monday, October 17
All survey releases will take place at 10:30 (ET). | https://www.bankofcanada.ca/2021/07/bank-canada-publishes-its-2022-schedule-policy-interest-rate-announcements-release-monetary-policy-report-other-major-publications/ | ca | 2021-07-29T00:00:00+00:00 | Bank of Canada publishes its 2022 schedule for policy interest rate announcements, the release of the Monetary Policy Report and other major publications | statements | false | null | 2021-11-29T00:03:11+00:00 |
4310fdf1b972-0 | The Bank of Canada today held its target for the overnight rate at 4½%, with the Bank Rate at 4¾% and the deposit rate at 4½%. The Bank is also continuing its policy of quantitative tightening.
Global economic developments have evolved broadly in line with the outlook in the January Monetary Policy Report (MPR). Global growth continues to slow, and inflation, while still too high, is coming down due primarily to lower energy prices. In the United States and Europe, near-term outlooks for growth and inflation are both somewhat higher than expected in January. In particular, labour markets remain tight, and elevated core inflation is persisting. Growth in China is rebounding in the first quarter. Commodity prices have evolved roughly in line with the Bank’s expectations, but the strength of China’s recovery and the impact of Russia’s war in Ukraine remain key sources of upside risk. Financial conditions have tightened since January, and the US dollar has strengthened.
In Canada, economic growth came in flat in the fourth quarter of 2022, lower than the Bank projected. With consumption, government spending and net exports all increasing, the weaker-than-expected GDP was largely because of a sizeable slowdown in inventory investment. Restrictive monetary policy continues to weigh on household spending, and business investment has weakened alongside slowing domestic and foreign demand.
The labour market remains very tight. Employment growth has been surprisingly strong, the unemployment rate remains near historic lows, and job vacancies are elevated. Wages continue to grow at 4% to 5%, while productivity has declined in recent quarters.
Inflation eased to 5.9% in January, reflecting lower price increases for energy, durable goods and some services. Price increases for food and shelter remain high, causing continued hardship for Canadians. With weak economic growth for the next couple of quarters, pressures in product and labour markets are expected to ease. This should moderate wage growth and also increase competitive pressures, making it more difficult for businesses to pass on higher costs to consumers.
Overall, the latest data remains in line with the Bank’s expectation that CPI inflation will come down to around 3% in the middle of this year. Year-over-year measures of core inflation ticked down to about 5%, and 3-month measures are around 3½%. Both will need to come down further, as will short-term inflation expectations, to return inflation to the 2% target.
At its January decision, the Governing Council indicated that it expected to hold the policy interest rate at its current level, conditional on economic developments evolving broadly in line with the MPR outlook. Based on its assessment of recent data, Governing Council decided to maintain the policy rate at 4½%. Quantitative tightening is complementing this restrictive stance. Governing Council will continue to assess economic developments and the impact of past interest rate increases, and is prepared to increase the policy rate further if needed to return inflation to the 2% target. The Bank remains resolute in its commitment to restoring price stability for Canadians.
Information note
The next scheduled date for announcing the overnight rate target is April 12, 2023. The Bank will publish its next full outlook for the economy and inflation, including risks to the projection, in the Monetary Policy Report at the same time. | https://www.bankofcanada.ca/2023/03/fad-press-release-2023-03-08/ | ca | 2023-03-08T00:00:00+00:00 | March 08 2023 - Statement | statements | false | null | 2023-03-29T12:31:21+00:00 |
8a36bfb44cf4-0 | The Bank of Canada today released its Update to the April Monetary Policy Report. The Update reviews economic and financial trends in the context of Canada's inflation-control strategy.
The July Update highlights a number of unanticipated developments that have changed the outlook for economic activity and inflation in Canada.
Inflation and inflation expectations have eased, and near-term domestic activity has been weakened by severe acute respiratory syndrome (SARS), an isolated case of bovine spongiform encephalopathy (BSE), and weaker-than-expected foreign demand for Canadian products. As well, the substantial rise in the value of the Canadian dollar against the U.S. dollar will have a dampening effect on the future growth of demand for Canadian goods and services. As a result, more slack is developing in the economy than was previously expected. It now appears that, by the end of this year, core inflation will fall below the 2 per cent target.
To support growth in domestic demand and aggregate levels of economic activity, the Bank left its target for the overnight rate unchanged on 3 June, and lowered it by 25 basis points to 3 per cent on 15 July.
The Bank expects that growth in Canada's economy will strengthen towards the end of 2003 and through 2004. Growth during 2004 will likely be higher than previously projected, suggesting that the economic slack that is expected to develop in 2003 will be largely absorbed by the end of next year.
The Bank will closely monitor the strength of domestic and external demand with a view to keeping inflation on track to meet the 2 per cent target over the medium term. | https://www.bankofcanada.ca/2003/07/bank-canada-releases-monetary-policy-report-update-10/ | ca | 2003-07-17T04:00:00+00:00 | Bank of Canada releases Monetary Policy Report Update | statements | false | null | 2021-10-18T18:07:25+00:00 |
1bd4d837bc1d-0 | The Bank of Canada today increased its target for the overnight rate to 4¼%, with the Bank Rate at 4½% and the deposit rate at 4¼%. The Bank is also continuing its policy of quantitative tightening.
Inflation around the world remains high and broadly based. Global economic growth is slowing, although it is proving more resilient than was expected at the time of the October Monetary Policy Report (MPR). In the United States, the economy is weakening but consumption continues to be solid and the labour market remains overheated. The gradual easing of global supply bottlenecks continues, although further progress could be disrupted by geopolitical events.
In Canada, GDP growth in the third quarter was stronger than expected, and the economy continued to operate in excess demand. Canada’s labour market remains tight, with unemployment near historic lows. While commodity exports have been strong, there is growing evidence that tighter monetary policy is restraining domestic demand: consumption moderated in the third quarter, and housing market activity continues to decline. Overall, the data since the October MPR support the Bank’s outlook that growth will essentially stall through the end of this year and the first half of next year.
CPI inflation remained at 6.9% in October, with many of the goods and services Canadians regularly buy showing large price increases. Measures of core inflation remain around 5%. Three-month rates of change in core inflation have come down, an early indicator that price pressures may be losing momentum. However, inflation is still too high and short-term inflation expectations remain elevated. The longer that consumers and businesses expect inflation to be above the target, the greater the risk that elevated inflation becomes entrenched.
Looking ahead, Governing Council will be considering whether the policy interest rate needs to rise further to bring supply and demand back into balance and return inflation to target. Governing Council continues to assess how tighter monetary policy is working to slow demand, how supply challenges are resolving, and how inflation and inflation expectations are responding. Quantitative tightening is complementing increases in the policy rate. We are resolute in our commitment to achieving the 2% inflation target and restoring price stability for Canadians.
Information note
The next scheduled date for announcing the overnight rate target is January 25, 2023. The Bank will publish its next full outlook for the economy and inflation, including risks to the projection, in the MPR at the same time. | https://www.bankofcanada.ca/2022/12/fad-press-release-2022-12-07/ | ca | 2022-12-07T00:00:00+00:00 | December 07 2022 - Statement | statements | false | null | 2023-03-29T12:31:20+00:00 |
82cb997eae1f-0 | The Bank of Canada today released its July Monetary Policy Report Update, which discusses current economic and financial trends in the context of Canada's inflation-control strategy.
Global and Canadian economic developments have been unfolding broadly as expected, and the Bank's outlook for output and inflation in Canada through to the end of 2006 is little changed from the scenario outlined in the April Monetary Policy Report. Strong growth in final domestic demand in Canada continues to offset the drag from net exports. Further progress has been made across sectors of the Canadian economy in adjusting to global developments, and the economy is operating close to its production capacity.
The Bank expects Canada's economy to grow by about 2.7 per cent in 2005 and 3.3 per cent in 2006. With the economy projected to continue to operate near capacity, and with inflation expectations firmly anchored, inflation is expected to return to 2 per cent by the end of 2006.
To support aggregate demand, the Bank has held the target for the overnight rate unchanged at 2 1/2 per cent since October 2004. However, in line with the Bank's outlook for growth and inflation, some reduction in the amount of monetary stimulus will be required in the near term to keep aggregate demand and supply in balance and inflation on target.
The risks to the outlook through 2006 relate primarily to the future path of prices for oil and non-energy commodities, the pace of growth in China, and the ongoing adjustment of the Canadian economy to global developments. These risks appear to be balanced. Over the medium term, however, there is increasing risk that the correction of global current account imbalances could involve a period of weakness in world aggregate demand. | https://www.bankofcanada.ca/2005/07/bank-canada-releases-monetary-policy-report-update-2/ | ca | 2005-07-14T04:00:00+00:00 | Bank of Canada releases Monetary Policy Report Update | statements | false | null | 2021-10-18T18:07:23+00:00 |
6ce38f568443-0 | The Bank of Canada today increased its target for the overnight rate to 1½%, with the Bank Rate at 1¾% and the deposit rate at 1½%. The Bank is also continuing its policy of quantitative tightening (QT).
Inflation globally and in Canada continues to rise, largely driven by higher prices for energy and food. In Canada, CPI inflation reached 6.8% for the month of April – well above the Bank’s forecast – and will likely move even higher in the near term before beginning to ease. As pervasive input price pressures feed through into consumer prices, inflation continues to broaden, with core measures of inflation ranging between 3.2% and 5.1%. Almost 70% of CPI categories now show inflation above 3%. The risk of elevated inflation becoming entrenched has risen. The Bank will use its monetary policy tools to return inflation to target and keep inflation expectations well anchored.
The increase in global inflation is occurring as the global economy slows. The Russian invasion of Ukraine, China’s COVID-related lockdowns, and ongoing supply disruptions are all weighing on activity and boosting inflation. The war has increased uncertainty and is putting further upward pressure on prices for energy and agricultural commodities. This is dampening the outlook, particularly in Europe. In the United States, private domestic demand remains robust, despite the economy contracting in the first quarter of 2022. US labour market strength continues, with wage pressures intensifying. Global financial conditions have tightened and markets have been volatile.
Canadian economic activity is strong and the economy is clearly operating in excess demand. National accounts data for the first quarter of 2022 showed GDP growth of 3.1 percent, in line with the Bank’s April Monetary Policy Report (MPR) projection. Job vacancies are elevated, companies are reporting widespread labour shortages, and wage growth has been picking up and broadening across sectors. Housing market activity is moderating from exceptionally high levels. With consumer spending in Canada remaining robust and exports anticipated to strengthen, growth in the second quarter is expected to be solid.
With the economy in excess demand, and inflation persisting well above target and expected to move higher in the near term, the Governing Council continues to judge that interest rates will need to rise further. The policy interest rate remains the Bank’s primary monetary policy instrument, with quantitative tightening acting as a complementary tool. The pace of further increases in the policy rate will be guided by the Bank’s ongoing assessment of the economy and inflation, and the Governing Council is prepared to act more forcefully if needed to meet its commitment to achieve the 2% inflation target.
Information note
The next scheduled date for announcing the overnight rate target is July 13, 2022. The Bank will publish its next full outlook for the economy and inflation, including risks to the projection, in the MPR at the same time. | https://www.bankofcanada.ca/2022/06/fad-press-release-2022-06-01/ | ca | 2022-06-01T00:00:00+00:00 | June 01 2022 - Statement | statements | false | null | 2023-03-29T12:31:19+00:00 |
ed4901b03d21-0 | The Bank of Canada expects all media organizations to respect the embargo conditions for its key publications. Today, the Bank provided the Monetary Policy Report (MPR) under embargo to trusted media that have signed an undertaking with the Bank. Note that the Bank did not provide embargoed access to the press release that explains the latest monetary policy decisions. One media organization breached the embargo time and published articles on two parts of the MPR: the key inputs to the projection and the section describing the evolution of our balance sheet.
We immediately contacted the organization in question and instructed them to provide an account of the circumstances surrounding the breach. In accordance with the Bank’s media policy, this organization will not have any further access to Bank embargos, lock-ups or media activities for a prescribed period. | https://www.bankofcanada.ca/2021/04/statement-monetary-policy-report-embargo-breach/ | ca | 2021-04-21T04:00:00+00:00 | Bank of Canada statement on Monetary Policy Report embargo breach | statements | false | null | 2021-10-18T18:07:23+00:00 |
92679918ceef-0 | The Bank of Canada today increased its target for the overnight rate to ½ %, with the Bank Rate at ¾ % and the deposit rate at ½ %. The Bank is continuing its reinvestment phase, keeping its overall holdings of Government of Canada bonds on its balance sheet roughly constant until such time as it becomes appropriate to allow the size of its balance sheet to decline.
The unprovoked invasion of Ukraine by Russia is a major new source of uncertainty. Prices for oil and other commodities have risen sharply. This will add to inflation around the world, and negative impacts on confidence and new supply disruptions could weigh on global growth. Financial market volatility has increased. The situation remains fluid and we are following events closely.
Global economic data has come in broadly in line with projections in the Bank’s January Monetary Policy Report (MPR). Economies are emerging from the impact of the Omicron variant of COVID-19 more quickly than expected, although the virus continues to circulate and the possibility of new variants remains a concern. Demand is robust, particularly in the United States. Global supply bottlenecks remain challenging, although there are indications that some constraints have eased.
Economic growth in Canada was very strong in the fourth quarter of last year at 6.7%. This is stronger than the Bank’s projection and confirms its view that economic slack has been absorbed. Both exports and imports have picked up, consistent with solid global demand. In January, the recovery in Canada’s labour market suffered a setback due to the Omicron variant, with temporary layoffs in service sectors and elevated employee absenteeism. However, the rebound from Omicron now appears to be well in train: household spending is proving resilient and should strengthen further with the lifting of public health restrictions. Housing market activity is more elevated, adding further pressure to house prices. Overall, first-quarter growth is now looking more solid than previously projected.
CPI inflation is currently at 5.1%, as expected in January, and remains well above the Bank’s target range. Price increases have become more pervasive, and measures of core inflation have all risen. Poor harvests and higher transportation costs have pushed up food prices. The invasion of Ukraine is putting further upward pressure on prices for both energy and food-related commodities. All told, inflation is now expected to be higher in the near term than projected in January. Persistently elevated inflation is increasing the risk that longer-run inflation expectations could drift upwards. The Bank will use its monetary policy tools to return inflation to the 2% target and keep inflation expectations well-anchored.
The policy rate is the Bank’s primary monetary policy instrument. As the economy continues to expand and inflation pressures remain elevated, the Governing Council expects interest rates will need to rise further. The Governing Council will also be considering when to end the reinvestment phase and allow its holdings of Government of Canada bonds to begin to shrink. The resulting quantitative tightening (QT) would complement increases in the policy interest rate. The timing and pace of further increases in the policy rate, and the start of QT, will be guided by the Bank’s ongoing assessment of the economy and its commitment to achieving the 2% inflation target.
Information note
The next scheduled date for announcing the overnight rate target is April 13, 2022. The Bank will publish its next full outlook for the economy and inflation, including risks to the projection, in the MPR at the same time. | https://www.bankofcanada.ca/2022/03/fad-press-release-2022-03-02/ | ca | 2022-03-02T00:00:00+00:00 | March 02 2022 - Statement | statements | false | null | 2023-03-29T12:31:18+00:00 |
53af7bf630ec-0 | The Bank of Canada today released its Update to the October Monetary Policy Report. These reports discuss economic and financial trends in the context of Canada's inflation-control strategy.
Core inflation has been higher than anticipated in recent months. This reflects not only a stronger-than-expected increase in premiums for auto and home insurance, but also some broadening of price pressures resulting from strong demand in the economy. Based on the analysis of the inflation data and other indicators of pressures on capacity, the Bank believes that the economy may be operating closer to its production potential than previously thought.
In the second half of 2002, the Canadian economy slowed to a growth rate close to potential, which is estimated at 3 per cent. The slowdown reflected the effects of financial and geopolitical uncertainties and weakness in the global economy. In the Bank's base-case projection for the Canadian economy, demand pressures are expected to strengthen in the second half of 2003 and into 2004, following growth at slightly below potential in the first half of this year.
Core and total rates of inflation are projected to decline through 2003 as the effects of the one-off factors diminish, but they will likely still be somewhat above 2 per cent at the end of 2003. Total CPI inflation will continue to be affected by developments in crude oil prices. If these prices were to stay at current levels of just over US$30 per barrel, total inflation could move up to between 4.0 and 4.5 per cent in the first quarter. If, however, oil prices ease back in the second half of the year, total inflation is projected to move down, back in line with core inflation.
With the stance of monetary policy currently very stimulative, a reduction of stimulus will be required to return inflation to the 2 per cent target over the medium term. A number of elements will come into play in determining the pace of increase in policy interest rates. Although much of the recent rise in inflation has been the result of one-off factors, the possibility that demand pressures are becoming more prominent cannot be ruled out. As well, there is a risk that inflation persistently above the 2 per cent target might lead to an increase in the expected trend of inflation. While we have seen an improvement in financial conditions, business and investor confidence remain fragile because of uncertainty about the geopolitical situation. And the way in which events in the Middle East unfold could affect demand and inflation, both globally and in Canada. | https://www.bankofcanada.ca/2003/01/bank-of-canada-releases-monetary-policy-report-update-3/ | ca | 2003-01-23T05:00:00+00:00 | Bank of Canada releases Monetary Policy Report Update | statements | false | null | 2021-10-18T18:07:21+00:00 |
dc0a71da9c85-0 | The Bank of Canada today held its target for the overnight rate at the effective lower bound of ¼ %, with the Bank Rate at ½ % and the deposit rate at ¼ %. With overall economic slack now absorbed, the Bank has removed its exceptional forward guidance on its policy interest rate. The Bank is continuing its reinvestment phase, keeping its overall holdings of Government of Canada bonds roughly constant.
The global recovery from the COVID-19 pandemic is strong but uneven. The US economy is growing robustly while growth in some other regions appears more moderate, especially in China due to current weakness in its property sector. Strong global demand for goods combined with supply bottlenecks that hinder production and transportation are pushing up inflation in most regions. As well, oil prices have rebounded to well above pre-pandemic levels following a decline at the onset of the Omicron variant of COVID-19. Financial conditions remain broadly accommodative but have tightened with growing expectations that monetary policy will normalize sooner than was anticipated, and with rising geopolitical tensions. Overall, the Bank projects global GDP growth to moderate from 6¾ % in 2021 to about 3½ % in 2022 and 2023.
In Canada, GDP growth in the second half of 2021 now looks to have been even stronger than expected. The economy entered 2022 with considerable momentum, and a broad set of measures are now indicating that economic slack is absorbed. With strong employment growth, the labour market has tightened significantly. Job vacancies are elevated, hiring intentions are strong, and wage gains are picking up. Elevated housing market activity continues to put upward pressure on house prices.
The Omicron variant is weighing on activity in the first quarter. While its economic impact will depend on how quickly this wave passes, it is expected to be less severe than previous waves. Economic growth is then expected to bounce back and remain robust over the projection horizon, led by consumer spending on services, and supported by strength in exports and business investment. After GDP growth of 4½ % in 2021, the Bank expects Canada’s economy to grow by 4% in 2022 and about 3½ % in 2023.
CPI inflation remains well above the target range and core measures of inflation have edged up since October. Persistent supply constraints are feeding through to a broader range of goods prices and, combined with higher food and energy prices, are expected to keep CPI inflation close to 5% in the first half of 2022. As supply shortages diminish, inflation is expected to decline reasonably quickly to about 3% by the end of this year and then gradually ease towards the target over the projection period. Near-term inflation expectations have moved up, but longer-run expectations remain anchored on the 2% target. The Bank will use its monetary policy tools to ensure that higher near-term inflation expectations do not become embedded in ongoing inflation.
While COVID-19 continues to affect economic activity unevenly across sectors, the Governing Council judges that overall slack in the economy is absorbed, thus satisfying the condition outlined in the Bank’s forward guidance on its policy interest rate. The Governing Council therefore decided to end its extraordinary commitment to hold its policy rate at the effective lower bound. Looking ahead, the Governing Council expects interest rates will need to increase, with the timing and pace of those increases guided by the Bank’s commitment to achieving the 2% inflation target.
The Bank will keep its holdings of Government of Canada bonds on its balance sheet roughly constant at least until it begins to raise the policy interest rate. At that time, the Governing Council will consider exiting the reinvestment phase and reducing the size of its balance sheet by allowing roll-off of maturing Government of Canada bonds.
Information note
The next scheduled date for announcing the overnight rate target is March 2, 2022. The Bank will publish its next full outlook for the economy and inflation, including risks to the projection, in the Monetary Policy Report on April 13, 2022. | https://www.bankofcanada.ca/2022/01/fad-press-release-2022-01-26/ | ca | 2022-01-26T00:00:00+00:00 | January 26 2022 - Statement | statements | false | null | 2023-03-29T12:31:17+00:00 |
2adf13c9222a-0 | The Bank of Canada today released its October Monetary Policy Report, which discusses current economic and financial trends in the context of Canada's inflation-control strategy.
In the Report, the Bank noted that three major interrelated global developments are having a profound impact on the Canadian economy and making the outlook for growth and inflation more uncertain than it was at the time of the July Monetary Policy Report Update. First, the intensification of the global financial crisis has led to severe strains in financial markets. The associated need for the global banking sector to continue to reduce leverage will restrain growth for some time. Second, the global economy appears to be heading into a mild recession, led by a U.S. economy that is already in recession. Third, there have been sharp declines in many commodity prices.
Consistent with the G7 Plan of Action, major economies have announced extraordinary measures to stabilize their financial systems. These initiatives will be pivotal to the resumption of the flow of credit to support global economic growth. Canada's economy and strong financial system will benefit directly from these actions.
The weaker outlook for global demand will increase the drag on the Canadian economy coming from exports. Lower commodity prices will also dampen the outlook, working through a deterioration in Canada's terms of trade to moderate domestic demand growth. The marked tightening in Canadian credit conditions in recent weeks will restrain business and housing investment.
The Bank expects growth to be sluggish through the first quarter of next year, then to pick up over the rest of 2009 and to accelerate to above-potential growth in 2010 supported by improving credit conditions, the lagged effects of monetary policy actions, and stronger global growth. The recent sizable depreciation of the Canadian dollar will also provide an important offset to the effects of weaker global demand and lower commodity prices. Overall, the Bank projects average annual growth in real GDP of 0.6 per cent in both 2008 and 2009, and 3.4 per cent in 2010.
With excess supply projected to build throughout 2009, and with lower assumed energy prices, inflationary pressures will ease significantly relative to the projection in the July Monetary Policy Report Update. Core inflation is now projected to remain below 2 per cent until the end of 2010. Total CPI inflation should peak during the third quarter of 2008, fall below 1 per cent in mid-2009, and then return to the 2 per cent target by the end of 2010.
On 21 October, the Bank of Canada lowered its policy interest rate by 25 basis points. That decision followed a 50 basis point cut on 8 October taken in concert with other major central banks. Together, these moves bring the cumulative reduction in the Bank's target for the overnight rate to 75 basis points since the Bank's previous fixed announcement date on 3 September. These actions provide timely and significant support to the Canadian economy. The cumulative reduction in the Bank's policy rate since the beginning of December 2007 is now 225 basis points.
In line with the new outlook, some further monetary stimulus will likely be required to achieve the 2 per cent inflation target over the medium term. The evolution of the financial crisis, its impact on the global economy, and the timing of the effects of the various extraordinary measures being taken to address it pose significant risks to the inflation projection on both the upside and the downside. | https://www.bankofcanada.ca/2008/10/bank-canada-releases-monetary-policy-report-6/ | ca | 2008-10-23T04:00:00+00:00 | Bank of Canada releases Monetary Policy Report | statements | false | null | 2021-10-18T18:07:21+00:00 |
d7e928beb455-0 | Bank of Canada today released the July update to its Monetary Policy Report, which discusses current economic and financial trends in the context of Canada's inflation-control strategy.
Economic growth and inflation in Canada in the first half of this year have been stronger than was expected in the April Monetary Policy Report. Final domestic demand has remained the key driver of economic growth in Canada, bolstered by firm commodity prices. The Bank judges that the economy is now operating further above its production potential than was projected at the time of the April Report. Both total CPI and core inflation have been higher than projected in April and are above the 2 per cent inflation target. Longer-term interest rates have increased, and the Canadian dollar has appreciated sharply, moving well above the trading range assumed in the last Report.
The Canadian economy is now projected to grow by 2.5 per cent in 2007, somewhat stronger than was expected in April, and to grow somewhat more slowly in 2008 and 2009 than previously projected. In this new projection, higher interest rates across the yield curve and a higher assumed range for the Canadian dollar of 93 to 95.5 cents U.S. act to moderate growth in 2008 and 2009 to an average of about 2 1/2 per cent. This brings aggregate demand and supply in Canada back into balance in 2009.
Inflation is projected to be slightly higher and more persistent than in the April Report. With the direct effect of the GST cut ending, and with the impact of the temporary decrease in gasoline prices in late 2006, total inflation is projected to peak at about 3 per cent in the fourth quarter of this year. However, as excess demand diminishes, total CPI and core inflation should decline to 2 per cent by early 2009.
There are both upside and downside risks to the Bank's inflation projection. The main upside risk is that household demand in Canada could be stronger than expected. The main downside risks are related to the higher Canadian dollar and the ongoing adjustment in the U.S. housing sector. In the context of the Bank's new projection, these risks appear to be roughly balanced.
On Tuesday, the Bank raised its key policy interest rate by one-quarter of one percentage point to 4 1/2 per cent. The Bank also noted that some modest further increase in the overnight rate may be required to bring inflation back to the target over the medium term. | https://www.bankofcanada.ca/2007/07/bank-canada-releases-monetary-policy-report-update-3/ | ca | 2007-07-12T04:00:00+00:00 | Bank of Canada releases Monetary Policy Report Update | statements | false | null | 2021-10-18T18:07:29+00:00 |
d70550f0a14c-0 | The Bank of Canada today released its April Monetary Policy Report, which discusses current economic and financial trends in the context of Canada's inflation-control strategy.
In the Report, the Bank noted that in an environment of continued high uncertainty, the global recession has intensified and become more synchronous since the Bank's January Monetary Policy Report Update, with weaker-than-expected activity in all major economies. Deteriorating credit conditions have spread quickly through trade, financial, and confidence channels. While more aggressive monetary and fiscal policy actions are under way across the G20, measures to stabilize the global financial system have taken longer than expected to enact. As a result, the recession in Canada will be deeper than anticipated, with the economy projected to contract by 3.0 per cent in 2009. The Bank now expects the recovery to be delayed until the fourth quarter and to be more gradual. The economy is projected to grow by 2.5 per cent in 2010 and 4.7 per cent in 2011, and to reach its production capacity in the third quarter of 2011. Given significant restructuring in a number of sectors, potential growth has been revised down. The recovery will be importantly supported by the Bank's accommodative monetary stance.
The Report notes that core inflation is expected to diminish through 2009, gradually returning to the 2 per cent target in the third quarter of 2011 as aggregate supply and demand return to balance. Total CPI inflation is expected to trough at -0.8 per cent in the third quarter of 2009 and return to target in the third quarter of 2011.
While the underlying macroeconomic risks to the projection are roughly balanced, the Bank judges that, as a consequence of conducting monetary policy at the effective lower bound, the overall risks to its inflation projection are tilted slightly to the downside.
With monetary policy now operating at the effective lower bound for the overnight policy rate, it is appropriate to provide more explicit guidance than is usual regarding its future path so as to influence rates at longer maturities. Conditional on the outlook for inflation, the target overnight rate can be expected to remain at its current level until the end of the second quarter of 2010 in order to achieve the inflation target. The Bank will continue to provide such guidance in its scheduled interest rate announcements as long as the overnight rate is at the effective lower bound.
To reinforce its conditional commitment to maintain the overnight rate at 1/4 per cent, the Bank has announced that it will roll over a portion of its existing stock of 1- and 3-month term purchase and resale agreements (PRAs) into 6- and 12-month terms at minimum and maximum bid rates that correspond to the target rate and the Bank Rate, respectively.
Against this background, the Bank lowered its policy rate by 25 basis points on Tuesday, 21 April, bringing the cumulative monetary policy easing to 425 basis points since December 2007. It is the Bank's judgment that this cumulative easing, together with the conditional commitment, is the appropriate policy stance to move the economy back to full production capacity and to achieve the 2 per cent inflation target. The Bank retains considerable flexibility in the conduct of monetary policy at low interest rates.
This is consistent with the framework outlined in today's Monetary Policy Report for conducting monetary policy when the overnight interest rate is at the effective lower bound. The framework sets out the instruments that the Bank would consider using, if required, to achieve its inflation objective. These instruments are: conditional statements about the future path of policy rates; quantitative easing; and credit easing. It also describes principles guiding the possible use of these instruments. | https://www.bankofcanada.ca/2009/04/bank-canada-releases-monetary-policy-report-5/ | ca | 2009-04-23T04:00:00+00:00 | Bank of Canada releases Monetary Policy Report | statements | false | null | 2021-10-18T18:07:17+00:00 |
f79a5dc84359-0 | This morning, we released our Update to last November's Monetary Policy Report. This Update was completed at the time of the Bank Rate announcement on 23 January. It presents the analysis on which we based our decision to reduce the Bank Rate by 25 basis points.
As discussed in the Update, world economic growth has slowed more than we were anticipating three months ago, mainly because of a more pronounced slowdown in the U.S. economy since the third quarter of last year.
Through the second half of 2000, despite lower U.S. demand for Canadian products, the pace of economic expansion in Canada remained solid, bolstered by strong growth in domestic demand. Indeed, real GDP in 2000 is estimated to have grown by 5 per cent, on an annual average basis. And by year-end, inflation, measured by the 12-month rate of increase in the core CPI, had moved up somewhat faster than anticipated—to close to 2 per cent.
Let me now look ahead. Although the Canadian economy began 2001 from a strong base, with signs of pressures in some labour and product markets, recent developments have altered the risks and uncertainties in our economic outlook. Most importantly, the abrupt weakening of U.S. economic activity raises the question of what the implications for Canada will be.
In the Update, we revised down our projection for Canada's economic growth this year to about 3 per cent. Core inflation is projected to stabilize at about 2 per cent, and total CPI inflation is expected to converge with the core rate in the second half, assuming that world crude oil prices stay at or below current levels. That projection also assumed that the U.S. economy would expand by 2.0 to 2.5 per cent, on average, in 2001, with a weak first half followed by a relatively strong rebound in the second half.
Based on the accumulating evidence, it now appears that U.S. economic activity in the first half of the year will be weaker than projected in the Update, but we still expect it to rebound in the second half. This poses some near-term risks for the Canadian economy. At the same time, high levels of employment and rising disposable incomes are working to sustain domestic demand growth here in Canada. And our solid fundamentals—low inflation, a declining public sector debt relative to the size of our economy, and business restructuring—have put the Canadian economy in a better position to adjust to external developments.
Overall, despite the near-term uncertainties, the Bank remains positive about our economic prospects for 2001. We will continue to monitor closely the evolving situation. | https://www.bankofcanada.ca/2001/02/release-monetary-policy-report-update/ | ca | 2001-02-06T05:00:00+00:00 | Release of the Monetary Policy Report Update | statements | false | null | 2021-10-18T18:07:28+00:00 |
18210ebaa034-0 | The Bank of Canada today released its January Monetary Policy Report Update, which discusses current economic and financial trends in the context of Canada's inflation-control strategy.
In the Update, the Bank noted that the outlook for the global economy has deteriorated since the October Monetary Policy Report, with the intensifying financial crisis spilling over into real economic activity. Heightened uncertainty is undermining business and household confidence worldwide and further eroding domestic demand. Major advanced economies, including Canada's, are now in recession, and emerging-market economies are increasingly affected. Commodity prices – especially energy prices – have fallen as a result of substantially weaker global demand.
Stabilization of the global financial system is a precondition for economic recovery. To that end, governments and central banks are taking bold and concerted policy actions. There are signs that these extraordinary measures are starting to gain traction, although it will take some time for financial conditions to normalize. In addition, considerable monetary and fiscal policy stimulus is being provided worldwide.
The Update notes that Canadian exports are down sharply, and domestic demand is shrinking as a result of declines in real income, household wealth, and confidence. Canada's economy is projected to contract through mid-2009, with real GDP dropping by 1.2 per cent this year on an annual average basis. As policy actions begin to take hold in Canada and globally, and with support from the past depreciation of the Canadian dollar, real GDP is expected to rebound, growing by 3.8 per cent in 2010.
A wider output gap through 2009 and modest decreases in housing prices should cause core CPI inflation to ease, bottoming at 1.1 per cent in the fourth quarter. Total CPI inflation is expected to dip below zero for two quarters in 2009, reflecting year-on-year drops in energy prices. With inflation expectations well-anchored, total and core inflation should return to the 2 per cent target in the first half of 2011 as the economy returns to potential.
Global developments pose significant upside and downside risks to the inflation projection. On the upside, the global economy could be stronger, if global fiscal stimulus turns out to be more expansionary than expected, or if aggressive policy actions taken across major economies restore confidence more quickly than projected. On the downside, the global recession could be deeper and more protracted because financial conditions take longer to normalize. The Bank judges that the risks are roughly balanced.
Against this background, the Bank lowered its policy rate by 50 basis points on Tuesday to 1 per cent, bringing the cumulative monetary policy easing to 350 basis points since December 2007. Guided by Canada's inflation-targeting framework, the Bank will continue to monitor carefully economic and financial developments in judging to what extent further monetary stimulus will be required to achieve the 2 per cent target over the medium term. Low, stable, and predictable inflation is the best contribution monetary policy can make to long-term economic growth and financial stability. | https://www.bankofcanada.ca/2009/01/bank-canada-releases-monetary-policy-report-update-4/ | ca | 2009-01-22T05:00:00+00:00 | Bank of Canada releases Monetary Policy Report Update | statements | false | null | 2021-10-18T18:07:16+00:00 |
a293016f88fb-0 | The Bank of Canada today released its semi-annual Monetary Policy Report, in which it discusses economic and financial trends in the context of Canada's inflation-control strategy.
Canada's economic outlook has improved significantly since the November Monetary Policy Report. Indeed, information on the fourth quarter of last year and the first quarter of 2002 indicates that the recovery in the Canadian economy began sooner and has been considerably stronger than anticipated.
The Bank now projects that the Canadian economy will grow between 3 1/2 and 4 1/2 per cent at annualized rates in the first half of 2002. It is expected to continue to expand at a rate above that of its production capacity in the second half of 2002 and in 2003. Thus, the economy is expected to be operating at full capacity in the second half of 2003.
In light of this outlook, the Bank began to reduce the substantial amount of monetary stimulus in the economy, raising the target for the overnight rate of interest by 25 basis points to 2.25 per cent on 16 April.
Nonetheless, important risks and uncertainties remain. Given the amount of monetary stimulus in place, growth in Canada could be stronger than projected. It is also possible that growth in household spending may not be as strong as anticipated, if more of the recent strength than assumed was borrowed from future expenditures. There is also uncertainty regarding the timing and strength of the pickup in business investment and exports, and how developments in the Middle East could affect crude oil prices and the global economy.
The challenge for monetary policy over the remainder of this year and through 2003 is to help the economy move back to, and then sustain, levels of production at capacity by taking actions aimed at achieving the Bank's 2 per cent target for inflation control. This means reducing, in a timely and measured manner, the substantial amount of stimulus in place. | https://www.bankofcanada.ca/2002/04/bank-canada-releases-april-monetary-policy-report/ | ca | 2002-04-24T04:00:00+00:00 | Bank of Canada releases its April Monetary Policy Report | statements | false | null | 2021-10-18T18:07:28+00:00 |
043562ff994d-0 | The Bank of Canada today released the January update to the Monetary Policy Report, which discusses current economic and financial trends in the context of Canada's inflation-control strategy.
The Canadian economy is judged to have been operating at, or just above, its production capacity at the end of 2006, following weaker-than-expected growth in the second half of last year. This slowdown stemmed from reduced demand for Canadian exports—related to weakness in the U.S. automotive and housing sectors—and from the need for Canadian businesses to adjust inventories.
Looking ahead, real GDP growth is now expected to average about 2 1/2 per cent in the first half of 2007, rising to about 2 3/4 per cent in the second half of this year. In 2008, growth is projected to remain in line with the growth of potential output (estimated at 2.8 per cent), keeping the economy operating near its capacity throughout the projection period. Expressed on an average annual basis, this profile implies growth of 2.3 per cent in 2007 and 2.8 per cent in 2008.
Total consumer price inflation will continue to be affected by movements in energy prices and, during the first half of 2007, by last year's reduction in the Goods and Services Tax (GST). Total inflation should average just above 1 per cent in the first half of this year, returning to the 2 per cent target in early 2008. Core inflation should return to 2 per cent in the first half of 2007 and stay there.
On 16 January, the Bank left its key policy rate unchanged at 4.25 per cent. The risks around the Bank's inflation projection continue to be judged to be roughly balanced, but the main upside and downside risks have diminished somewhat since the October MPR. The current level of the policy interest rate is judged, at this time, to be consistent with achieving the inflation target over the medium term. | https://www.bankofcanada.ca/2007/01/bank-canada-releases-monetary-policy-report-update-7/ | ca | 2007-01-18T05:00:00+00:00 | Bank of Canada releases Monetary Policy Report Update | statements | false | null | 2021-10-18T18:07:15+00:00 |
4307aedb7808-0 | Bank of Canada Governor Gordon Thiessen today commented on the release of the semi-annual Monetary Policy Report, which discusses current economic trends and their implications for monetary policy.
Mr. Thiessen noted that since the release of the last Report in November, 1997, there have been an unusual number of developments which have had important economic and financial consequences. These include the crisis in Asia, declines in commodities prices, and the persistent weakness of the Japanese economy. At the same time, the U.S. economy has been considerably stronger than expected. At home, there were strikes by Ontario's teachers and by Canada's postal workers in the fourth quarter of 1997, as well as the January ice storm in eastern Canada. These developments have resulted in a higher-than-usual degree of uncertainty, Mr. Thiessen added.
"Adding up the effects of recent events, we see the economy continuing on a solid growth path, but not at the same rapid pace as in 1997," Mr. Thiessen said. "Despite the effects of developments in Asia, the economy is being supported by a vigorous U.S. economy and accommodative monetary conditions. Inflation is expected to remain inside our target range."
"While the uncertainty surrounding the outlook is greater than normal, the risks appear balanced. This outlook implies that the economy would reach a level close to full capacity during the course of 1999," Mr. Thiessen added.
On the implications for monetary policy, Mr. Thiessen said, "It is the Bank's judgment that over the next six months, the recent range of monetary conditions would be broadly appropriate in the absence of further shocks. However, given the degree of uncertainty that is likely to persist, monetary conditions may continue to fluctuate over a relatively wide range."
Looking further ahead, he added: "If the underlying momentum of activity remains as strong as is currently expected, less-stimulative monetary conditions would appear to be called for as the economy approaches and achieves full capacity. This would ensure that inflation remains low, and that continued gains in output and employment can be sustained." | https://www.bankofcanada.ca/1998/05/governor-comments-release-monetary-policy-report/ | ca | 1998-05-13T04:00:00+00:00 | Bank of Canada Governor comments on release of the Monetary Policy Report | statements | false | null | 2021-10-18T18:07:26+00:00 |
6966c69fbd4d-0 | Since the October 2002 Monetary Policy Report, both core and total CPI inflation have been well above the 2 per cent inflation target. In this environment, inflation expectations have edged up.
In view of the domestic inflation situation and the underlying momentum of domestic demand, the Bank raised its target overnight rate on each of its last two policy announcement dates by 25 basis points, bringing it to 3.25 per cent.
Economic, financial, and geopolitical uncertainty has figured prominently in the global economic picture over the past six months. Some of the geopolitical and financial uncertainty has lifted more recently, and the Bank expects that it will continue to recede. However, over the near term, a degree of global economic uncertainty remains, and in Canada there is uncertainty about the possible economic impact of severe acute respiratory syndrome (SARS), particularly in the Greater Toronto Area. Overall, the risks confronting the world economy now appear to be better balanced compared with last autumn, and by year-end, business and household confidence levels should be higher.
Economic activity should begin to strengthen towards the end of this year and through 2004, particularly in North America. In Canada, most of the small amount of economic slack that is likely to open up during 2003 will have closed by the end of 2004.
Core inflation is expected to remain near 3 per cent through mid-2003. It is projected to fall to about 2 per cent by early 2004. Total CPI inflation will continue to be importantly affected by swings in crude oil prices.
The Bank continues to believe that further reductions in monetary stimulus will be necessary over time to return inflation to the 2 per cent target and to sustain output levels close to capacity. The timing and pace of further increases in policy interest rates will depend on the strength of domestic demand, the evolution of inflation expectations, and the pace of economic expansion in the United States and in overseas economies. | https://www.bankofcanada.ca/2003/04/bank-canada-releases-monetary-policy-report-2/ | ca | 2003-04-23T04:00:00+00:00 | Bank of Canada releases Monetary Policy Report | statements | false | null | 2021-10-18T18:07:13+00:00 |
7347c2681537-0 | Bank of Canada Governor Gordon Thiessen today commented on the release of the Monetary Policy Report for November 1998. The semi-annual report discusses current economic trends in the context of monetary policy.
Mr. Thiessen noted that global economic uncertainties had intensified during the past six months, particularly following Russia's decision in August to declare a debt moratorium. Many emerging market countries were faced with large capital outflows and widening interest rate spreads as investors looked for safe havens. More broadly, spreads between private sector and government bonds also increased, and market liquidity fell.
As a result of the economic and financial upheavals in the international area, estimates for global economic growth in 1998 and 1999 have been revised downwards. Nevertheless, said Mr. Thiessen, economic activity in the major industrial countries, particularly in North America and Europe, is still expected to be reasonably well sustained through to the end of 1999.
"We expect the Canadian economy to continue expanding over the next year on the basis of the projected sustained domestic demand in the United States and accommodative monetary conditions in Canada," Mr. Thiessen said. However, the turbulent international developments have created a greater-than-usual uncertainty around the economic outlook, he added.
The Governor noted that financial stability is particularly important to household and business confidence. Thus, the extent to which growth in Canada's economy will take up slack over the next year will depend on how quickly international and domestic financial markets stabilize. "Preserving confidence among investors in Canadian financial markets will therefore be an important consideration for the Bank over the near term," he said.
Mr. Thiessen reaffirmed that the fundamental focus of monetary policy over the medium term continues to be on keeping inflation within the target range. Inflation is expected to remain in the lower half of the Bank's target range of 1 to 3 per cent over the next year.
"Preserving low and stable inflation is how monetary policy can best contribute to improved overall economic performance over the long haul and indeed to the long-term maintenance of confidence in financial markets as well," said Mr. Thiessen. | https://www.bankofcanada.ca/1998/11/governor-comments-release-monetary-policy-report-2/ | ca | 1998-11-16T05:00:00+00:00 | Bank of Canada Governor comments on release of the Monetary Policy Report | statements | false | null | 2021-10-18T18:07:26+00:00 |
a2c8584453c9-0 | Bank of Canada today released its April Monetary Policy Report, which discusses current economic and financial trends in the context of Canada's inflation-control strategy.
Growth in the global economy has weakened since the January Monetary Policy Report Update, reflecting the effects of a sharp slowdown in the U.S. economy and ongoing dislocations in global financial markets. Growth in the Canadian economy has also moderated. Buoyant growth in domestic demand, supported by high employment levels and improved terms of trade, has been substantially offset by a fall in net exports. Both total and core CPI inflation were running at about 1.5 per cent at the end of the first quarter, but the underlying trend of inflation is judged to be about 2 per cent, consistent with an economy that is running just above its production capacity.
The U.S. economic slowdown is projected to be deeper and more protracted than in the January Update. The projection reflects a more pronounced impact on consumer spending of the contraction in the U.S. housing market and significantly tighter credit conditions.
The deterioration in economic and financial conditions in the United States will have direct consequences for the Canadian economy. First, exports are projected to decline, exerting a significant drag on growth in 2008. Second, turbulence in global financial markets will continue to affect the cost and availability of credit. Third, business and consumer sentiment in Canada is expected to soften somewhat. Nevertheless, domestic demand is projected to remain strong, supported by firm commodity prices, high employment levels, and the effect of cumulative easing in monetary policy.
The Bank projects that the Canadian economy will grow by 1.4 per cent this year, 2.4 per cent in 2009, and 3.3 per cent in 2010. The emergence of excess supply in the economy should keep inflation below 2 per cent through 2009. Both core and total inflation are projected to move up to 2 per cent in 2010 as the economy moves back into balance. There are both upside and downside risks to the Bank's new projection for inflation; these risks appear to be balanced.
In line with this outlook, some further monetary stimulus will likely be required to achieve the inflation target over the medium term. Given the cumulative reduction in the target for the overnight rate of 150 basis points since December, including the 50-basis-point reduction announced on 22 April, the timing of any further monetary stimulus will depend on the evolution of the global economy and domestic demand, and their impact on inflation in Canada. | https://www.bankofcanada.ca/2008/04/bank-canada-releases-monetary-policy-report-7/ | ca | 2008-04-24T04:00:00+00:00 | Bank of Canada releases Monetary Policy Report | statements | false | null | 2021-10-18T18:07:24+00:00 |
c57fa0bc61dd-0 | Today the Bank of Canada released its tenth Monetary Policy Report in which it discusses economic and financial trends in the context of Canada's inflation-control strategy. The Monetary Policy Report is published every May and November.
In this edition of the Report, the Bank notes that Canada's economic growth is expected to remain strong. With exports growing strongly and domestic spending rising, the Canadian economy in 1999 is likely to register growth close to 3¾ per cent on an annual average basis. Inflation in Canada has been broadly in line with expectations over the past six months and has moved towards the middle of the Bank's 1 to 3 per cent target range.
The increased momentum in the Canadian economy has taken place against a backdrop of continuing improvement in the international economic environment. The U.S. economy continues to show surprising strength and relatively low inflation despite a tight labour market. A number of the Asian economies that were hurt by the 1997-98 financial crisis have recovered more rapidly than expected. Japanese output has increased sharply following two years of recession, and growth in Europe has picked up. There has also been a significant turnaround in world commodity prices.
For 2000, the U.S. economy is expected to slow to a more sustainable pace. On this basis, the Bank projects economic growth in Canada to be in the range of 2¾ to 3¾ per cent. Given this growth projection, and with inflation expectations settling around the midpoint of the Bank's target range, the Bank expects core inflation to remain close to 2 per cent through next year.
However, there are some important risks to this projection of economic growth and inflation. These risks relate to the possibility of a stronger momentum of demand from domestic as well as international sources and to potential inflation pressures in the United States.
In order to preserve the low trend of inflation incorporated in this projection, the Bank must be ready to adjust monetary conditions in a timely manner. The challenge will be to assess carefully, using all available coincident and leading indicators, when adjustments are needed. Any resurgence of inflation in Canada would undermine our prospects for a durable expansion. | https://www.bankofcanada.ca/1999/11/semi-annual-monetary-policy-report/ | ca | 1999-11-17T05:00:00+00:00 | Bank of Canada releases its semi-annual Monetary Policy Report | statements | false | null | 2021-10-18T18:07:11+00:00 |
baa9bde65afa-0 | The Bank of Canada today released its April Monetary Policy Report, which reviews economic and financial trends in the context of Canada's inflation-control strategy.
The Canadian economy continues to adjust to developments in the global economy, such as stronger world demand, higher commodity prices, and the realignment of world currencies, including the Canadian dollar. Emerging-market economies, especially China and India, are contributing to intensified competition but are also creating new trading opportunities for Canada.
These developments require shifts in activity among sectors and create a need for adjustments by many businesses. Monetary policy is facilitating these adjustments by supporting aggregate demand, with the goal of keeping the economy near its full potential and inflation on target.
The Canadian economy was affected by a number of shocks in 2003. Thus, despite a broadening of the global economic recovery and higher commodity prices, economic growth in Canada at the end of the year was well below the level projected by the Bank in its October Monetary Policy Report. Preliminary indications are that growth in the first quarter of this year was marginally below 3 per cent. The Bank's view is that the economy is operating significantly below its potential.
The Bank's outlook for economic growth and inflation is essentially unchanged from that of the January Monetary Policy Report Update. The economy is expected to grow by about 2 3/4 per cent in 2004, picking up to about 3 3/4 per cent in 2005. This stronger growth is expected to come from private domestic demand, reflecting the current monetary stimulus in the economy and high levels of business and consumer confidence. Such growth would return the economy to close to its production potential by the third quarter of 2005. Core inflation—which removes the most volatile components of the consumer price index and the impact of indirect taxes on the remaining components—should average 1 1/2 per cent over the remainder of this year. As excess supply in the economy diminishes, core inflation is expected to move back to 2 per cent by the end of 2005.
The main uncertainty for the outlook continues to relate to how the Canadian economy adjusts to global developments. Overall, the risks to the outlook appear balanced. | https://www.bankofcanada.ca/2004/04/bank-canada-releases-monetary-policy-report/ | ca | 2004-04-15T04:00:00+00:00 | Bank of Canada releases Monetary Policy Report | statements | false | null | 2021-10-18T18:07:22+00:00 |
dfdb7467e0e2-0 | Since the April Monetary Policy Report, the Canadian economy has been hit by a number of unusual shocks: SARS, BSE, the Ontario electricity blackout, and the severe forest fires in British Columbia. Inflation has also fallen faster and further than expected. This drop in core inflation reflected several unforeseen developments. These include a broad-based weakness in the prices of goods, substantial reductions in the prices of tourism-related services because of SARS, and a slightly faster easing of pressures from insurance premiums. The substantial fall in the value of the U.S. dollar added to the weakness in goods prices. The Bank now estimates that there is more slack in the economy than was projected in April.
The prospects for near-term growth in the global economy have improved since April, and geopolitical uncertainty has continued to decrease. The near-term outlook for the U.S. economy is much improved. The economy in the euro area is still weak, but prospects for Asia look bright, led by China and India. The Japanese economy is performing better than anticipated.
The Bank expects growth in the Canadian economy to strengthen during the fourth quarter and through 2004. On balance, the expansion should be above the rate of potential growth, relying primarily on solid household spending and increased business investment. Stronger growth abroad should boost foreign demand for Canadian products, but this will be dampened by the higher value of the Canadian dollar. Growth is expected to average a little over 3 per cent in the second half of 2003 and 3 1/4 per cent in 2004. With growth above potential, the slack in the economy should be absorbed by early 2005.
The Bank expects core inflation to average just over 1.5 per cent for the rest of 2003, and to fall to just above 1 per cent in early 2004, as the effects of earlier increases in insurance premiums dissipate. Core inflation should return to 2 per cent by mid-2005, as economic slack is taken up. Total CPI inflation will continue to be importantly affected by swings in the price of crude oil. If prices ease to US$27 per barrel next year, total CPI inflation would likely fall below core inflation in 2004.
However, there are significant risks to this outlook. These risks relate to the timing and magnitude of global demand, price, and exchange rate adjustments to economic imbalances. In particular, there is uncertainty both about the likely changes in key global exchange rates and their effect on the Canadian economy. There is also uncertainty about the sustainability of U.S. growth beyond mid-2004.
We continue to assess the implications of all these developments—both past and future—for output and inflation in Canada, and what this means for monetary policy. | https://www.bankofcanada.ca/2003/10/bank-canada-releases-monetary-policy-report-10/ | ca | 2003-10-22T04:00:00+00:00 | Bank of Canada releases Monetary Policy Report | statements | false | null | 2021-10-18T18:07:10+00:00 |
8758ad9775e5-0 | The Bank of Canada today released its semi-annual Monetary Policy Report in which it discusses economic and financial trends in the context of Canada's inflation-control strategy.
During the past summer, evidence began to accumulate that the economic slowdown in North America would be deeper and longer-lasting than anticipated. The terrorist attacks in the United States have added a further element of weakness and uncertainty for the global economy and for Canada. Economic growth in Canada is expected to be close to zero or slightly negative in the second half of 2001.
Beyond the immediate impact, the size and duration of the economic consequences of the terrorist attacks in the United States are very difficult to assess. How quickly levels of activity recover and economic growth resumes will depend crucially on geopolitical developments and on how soon consumer and business confidence in the United States and Canada return to normal.
Because of the unusual nature of the uncertainty we face, the Bank is not presenting a conventional forecast, but rather an economic outlook based on working assumptions. These assumptions are that there will be no further major escalation of terrorism and that business and consumer confidence will return to normal levels in the second half of 2002.
Based on the Bank's working assumptions and given the amount of monetary and fiscal stimulus that has been provided, the economy will gain speed through 2002, with growth averaging about 2 per cent in the first half and 4 per cent in the second half (above the rate of potential output growth).
With more slack opening up in the economy, core inflation is expected to fall to about 1½ per cent in the second half of 2002. Total CPI inflation in 2002 is also projected to move below the 2 per cent midpoint of the Bank's inflation-control target range, if energy prices remain at or below their levels of early September.
This outlook and analysis will guide the Bank's judgment about the appropriate course for monetary policy, as more information becomes available. | https://www.bankofcanada.ca/2001/11/bank-of-canada-releases-semi-annual-monetary-policy-report/ | ca | 2001-11-07T05:00:00+00:00 | Bank of Canada releases semi-annual Monetary Policy Report | statements | false | null | 2021-10-18T18:07:20+00:00 |
25a6566e7641-0 | Bank of Canada Governor Gordon Thiessen today commented on the release of the Bank's ninth Monetary Policy Report. First published four years ago, the twice-yearly Report is released in May and November and discusses current economic trends in the context of monetary policy.
Mr. Thiessen noted that the outlook for the world economy has become more positive. The turbulence that characterized international markets last autumn has subsided and investor confidence is being restored. Supported by a robust U.S. economy, accommodative domestic monetary conditions, and recovery from labour disruptions last summer, the pace of economic activity in Canada picked up in the fourth quarter of 1998 and early 1999. "The Canadian economy is regaining its momentum," said Mr. Thiessen.
Mr. Thiessen said that, compared with six months ago, the Bank has raised its projection for growth in the economy in 1999 to between 2¾ and 3¾ per cent. This is higher than the latest consensus among private sector forecasters. Mr. Thiessen said Canadian exports should continue to grow because of Canada's good price and cost performance relative to its trading partners.
"Household spending should continue to recover," he added, "spurred by gains in employment and an improvement in consumer confidence."
"Looking forward, we expect core inflation to rise modestly over the next 18 months," said Mr. Thiessen, "but remain in the lower half of the Bank's 1 to 3 per cent target range for inflation." There is a high level of confidence among sophisticated investors that Canada's inflation will remain low, he pointed out.
Mr. Thiessen stressed that, while the risks to the outlook for the economy and inflation appear balanced, several significant uncertainties remain. One of the main risks is the divergent economic performance of the major industrial countries. On the domestic side, there is uncertainty regarding the margin of unused capacity in the economy. The Bank plans to place increasing weight on a wide range of economic indicators for signs of pressures on production capacity and on inflation. | https://www.bankofcanada.ca/1999/05/bank-canada-releases-semi-annual-monetary-policy-report-2/ | ca | 1999-05-19T04:00:00+00:00 | Bank of Canada releases its semi-annual Monetary Policy Report | statements | false | null | 2021-10-18T18:07:08+00:00 |
c86828d7a32f-0 | The Bank of Canada today released its Update to the October Monetary Policy Report. This report discusses economic and financial trends in the context of Canada's inflation-control strategy.
Since the October Monetary Policy Report, three developments have led the Bank to modify its outlook for economic growth and inflation in Canada: stronger-than-expected world economic activity, the continued sharp depreciation of the U.S. dollar against major world currencies (including the Canadian dollar), and a somewhat larger output gap in Canada at the end of 2003. Weighing these developments and their likely persistence, the Bank lowered its projection of output in Canada over the next year and a half. In this context, the Bank cut policy interest rates to support aggregate demand and thus return inflation to 2 per cent over the medium term.
In Canada, economic growth in the period ahead will need to come primarily from private domestic demand, supported by monetary stimulus and by strong business confidence. The Bank now projects growth to average about 2 3/4 per cent in 2004, and to pick up to about 3 3/4 per cent in 2005. This would imply that the output gap would not change materially before the end of 2004, but would be substantially closed by the third quarter of 2005.
Core inflation is projected to fall below 1 1/2 per cent in early 2004, before gradually moving back to the 2 per cent target by the end of 2005. If oil prices ease to about US$30 per barrel in the second half of 2004 and US$28 in 2005, as suggested by futures contracts, total CPI inflation should remain below core inflation through 2005.
The main uncertainties in the outlook relate to the adjustment of the Canadian economy to global changes. These include a stronger world economy, higher commodity prices, and the realignment of world currencies, including the Canadian dollar. Canadian monetary policy facilitates the overall adjustment process by helping to sustain aggregate demand in Canada. | https://www.bankofcanada.ca/2004/01/bank-of-canada-releases-monetary-policy-report-update/ | ca | 2004-01-22T05:00:00+00:00 | Bank of Canada releases Monetary Policy Report Update | statements | false | null | 2021-10-18T18:07:19+00:00 |
b6b56ff0a842-0 | Today, the Bank of Canada released its October Monetary Policy Report, in which it discusses economic and financial trends in the context of Canada's inflation-control strategy.
The Canadian economy has been expanding strongly so far this year and is now operating fairly close to its full production capacity. Consumer price inflation has risen above the 2 per cent target and is expected to rise further before year-end because of high oil prices and a number of other relative price movements. What is important for monetary policy is that these one-off influences on specific prices not feed more generally into price and wage inflation.
The Canadian economy has grown more rapidly than those of all other G-7 countries over the past year. Annualized growth exceeded 5 per cent in the first half of 2002—well above the growth of the economy's potential. We estimate that Canada's economy grew at an annualized rate of about 4 per cent in the third quarter. Thus, there has been a significant reduction in the amount of excess supply in the economy so far this year.
Looking ahead, global economic, financial, and geopolitical uncertainties are likely to moderate the rate of Canada's economic growth over the next three quarters. Growth should come in at the bottom of, or slightly below, the 3 to 4 per cent range that we anticipated in the last Update.
The output gap is very small. Assuming the uncertainties now clouding the outlook dissipate in the second half of next year, we expect growth to accelerate to above potential at that time, absorbing the remaining small amount of excess supply.
The Bank's core measure of inflation is running above our earlier projections. This largely reflects sharp increases in home and auto insurance premiums and, in Ontario, electricity prices. Core inflation is also being pushed up by strong demand for housing.
All told, core inflation is expected to peak at about 3 per cent by the end of this year. But, as the one-time influences fade, core inflation is expected to decline in the second half of 2003, provided those one-time factors do not feed into price and wage inflation more generally.
The Canadian economy is now operating not far from its capacity. In order to sustain non-inflationary growth, we will need to continue to remove monetary stimulus before the excess supply in the economy is completely absorbed. The pace and extent of this action will depend on the balance of domestic and external developments and on their implications for pressures on capacity and inflation in Canada. | https://www.bankofcanada.ca/2002/10/bank-canada-releases-october-monetary-policy-report/ | ca | 2002-10-23T04:00:00+00:00 | Bank of Canada releases its October Monetary Policy Report | statements | false | null | 2021-10-18T18:07:08+00:00 |
eb036973e4c7-0 | The Bank of Canada today released its twelfth semi-annual Monetary Policy Report in which it discusses economic and financial trends in the context of Canada's inflation-control strategy. The Monetary Policy Report is published every May and November.
The Bank reports that the Canadian economy has continued to expand briskly, outstripping expectations. Despite this robust growth, core inflation has remained lower than expected.
The global economy is showing strong momentum. While demand in the U.S. economy remains robust, recent data indicate that overall growth has slowed. Many emerging markets have continued to recover from the 1997–98 financial crisis. In Europe, growth is expected to remain solid in coming quarters. The Japanese economy, although still fragile, is improving.
The Bank of Canada is currently projecting economic growth of close to 5 per cent for 2000. This reflects the upward revision to Canada's GDP in the second half of 1999 and the robust performance in the first half of this year. For 2001, the Bank expects growth to slow to a range of 3 to 4 per cent, primarily reflecting the expected slowdown in the U.S. economy. While there are signs that the Canadian economy has begun to slow, the momentum of demand will increase pressures on production capacity. As a result, core inflation is expected to rise to the 2 per cent midpoint of the Bank's inflation-control target range in the second half of 2001. If oil prices were to stabilize at levels just below US$30 a barrel, the rate of increase in the total CPI would be expected to move down to about 2 per cent by the end of 2001.
The main risks to this outlook revolve around demand, supply, and inflation expectations. On the demand side, continued robust growth in U.S. demand for Canadian exports could increase inflation pressures here. On the supply side, brisk spending on machinery and equipment, combined with recent productivity gains, may raise capacity limits beyond projected levels. However, the Bank will continue to take a cautious approach to projecting potential output, updating its estimates as evidence accumulates. Higher energy prices may feed into the prices of other goods and services and into expectations of future inflation.
The challenge for monetary policy will be to carefully assess the balance between aggregate demand and supply in the economy and to guard against the risk that higher energy prices could affect core inflation and inflation expectations. The Bank must be prepared to adjust monetary conditions in a timely manner to preserve the low trend of inflation that has been benefiting the Canadian economy. | https://www.bankofcanada.ca/2000/11/releases-semi-annual-monetary-policy-report/ | ca | 2000-11-09T05:00:00+00:00 | Bank of Canada releases semi-annual Monetary Policy Report | statements | false | null | 2021-10-18T18:07:18+00:00 |
0e24d1c637fb-0 | The Bank of Canada today released its October Monetary Policy Report, which reviews economic and financial trends in the context of Canada's inflation-control strategy.
The Canadian economy has grown faster than was projected in last April's Monetary Policy Report and the July Update, largely because of a surge in exports. It is now operating near its production capacity and continues to adjust to global economic developments.
The Bank's base-case projection for the period to the end of 2006 calls for aggregate demand for Canadian goods and services to expand, on average, at about the same rate as potential output. Given the effects of higher oil prices and the past appreciation of the Canadian dollar, the Bank projects economic growth to be slightly less than 3 per cent in 2005, and slightly more than 3 per cent in 2006.
With the economy expected to remain near its production capacity throughout this period, core inflation is projected to move back up to the 2 per cent target by the end of 2005. Given the path suggested by futures prices for crude oil, the Bank expects total CPI inflation will rise to the top of the 1 to 3 per cent target range in the first half of 2005, before falling slightly below core inflation in early 2006.
Against this background, the Bank raised its target for the overnight rate to 2.5 per cent on 19 October. To keep the economy near its production potential and to achieve the inflation target, further reduction of monetary stimulus will be required over time with the pace of interest rate increases depending on the Bank's continuing assessment of the prospects for factors that affect pressures on capacity and, hence, inflation.
There are significant risks and uncertainties around this base-case projection, related to the adjustment to changes in the global economy, including changes in commodity prices and exchange rates. The risks surrounding global economic prospects relate primarily to the evolution of oil prices, the pace of expansion in China, the way in which current account imbalances in the United States and East Asia will be resolved, and geopolitical developments. | https://www.bankofcanada.ca/2004/10/bank-of-canada-releases-monetary-policy-report/ | ca | 2004-10-21T04:00:00+00:00 | Bank of Canada releases Monetary Policy Report | statements | false | null | 2021-10-18T18:07:06+00:00 |
829b2cf252c3-0 | The Bank of Canada today released its Update to the October Monetary Policy Report. The Update discusses current economic and financial trends in the context of Canada's inflation-control strategy.
The outlook for the Canadian economy continues to be shaped by global developments, including the realignment of world currencies. The near-term outlook for the global economy is a touch weaker than projected in the October Report, but more solidly based because of somewhat lower oil prices and greater confidence in the momentum of the U.S. economy.
The Canadian economy is expected to operate a little further below its full production capacity in 2005 than was anticipated at the time of the last Report, largely reflecting the dampening effects on aggregate demand of the recent appreciation of the Canadian dollar. For 2006, growth is projected to pick up to slightly more than 3 per cent, consistent with returning the economy to its production capacity in the second half of the year, and returning core inflation to 2 per cent around the end of 2006. In line with this revised outlook, the pace of reduction in monetary stimulus is likely to be slower than that envisioned in the October Report.
This outlook is subject to both upside and downside risks and to uncertainties. While the near-term risks surrounding the global economic outlook have lessened, there are still significant medium-term risks related to the evolution of oil prices, the pace of expansion in China, the way in which current account balances in the United States and East Asia will be resolved, and geopolitical developments. | https://www.bankofcanada.ca/2005/01/bank-canada-releases-monetary-policy-report-update/ | ca | 2005-01-27T05:00:00+00:00 | Bank of Canada releases Monetary Policy Report Update | statements | false | null | 2021-10-18T18:07:18+00:00 |
1e9944331e4d-0 | The Bank of Canada today released its April Monetary Policy Report, which discusses current economic and financial trends in the context of Canada's inflation-control strategy.
Growth of the Canadian economy has been essentially in line with the Bank's expectations as set out in the January Monetary Policy Report Update. But inflation has been higher than expected. After considering the full range of indicators, the Bank now judges that the Canadian economy was operating just above its production capacity in the first quarter of this year.
Over the projection horizon, domestic demand continues to be the main driver of growth in Canada. With the U.S. slowdown now expected to be somewhat more prolonged than previously projected, net exports should exert a slightly greater drag on growth in 2007. The Canadian economy is projected to grow by 2.2 per cent in 2007 and 2.7 per cent in both 2008 and 2009, returning to its production capacity in the second half of 2007 and remaining there through 2008 and 2009.
Core inflation should remain slightly above 2 per cent over the coming months, given pressures on capacity and the impact of higher core food prices. But with the economy projected to return to its production capacity in the second half of this year and with further easing of pressures from housing prices, upward pressure on core inflation is expected to moderate, bringing core inflation back to 2 per cent by the end of 2007.
Total CPI inflation is projected to rise above the 2 per cent inflation target in the second half of this year, peaking below 3 per cent near the end of 2007 before returning to the target by mid-2008.
The Bank continues to judge that the risks to its inflation projection are roughly balanced, although there is now a slight tilt to the upside.
On Tuesday, the Bank left its key policy rate unchanged at 4 1/4 per cent. The current level of the policy interest rate is judged, at this time, to be consistent with achieving the inflation target over the medium term. | https://www.bankofcanada.ca/2007/04/bank-canada-releases-monetary-policy-report-4/ | ca | 2007-04-26T04:00:00+00:00 | Bank of Canada releases Monetary Policy Report | statements | false | null | 2021-10-18T18:07:01+00:00 |
96580e0e3e1e-0 | The Bank of Canada today released its January Monetary Policy Report Update. In this Update, the Bank said that the Canadian economy continues to operate above its production capacity, despite some slowing in growth in the fourth quarter of 2007. Both total and core inflation have been lower than projected in the October Monetary Policy Report, largely reflecting a price-level adjustment related to increased competitive pressures in the retail sector stemming from the level of the Canadian dollar.
Financial conditions have deteriorated since October, leading to tighter credit conditions in industrialized countries. Given this, and a deeper and more prolonged decline in the U.S. housing sector, the U.S. economic outlook for 2008 has been revised downwards significantly.
The weaker U.S. economy will put additional downward pressure on Canada's export growth. Despite tighter credit conditions, domestic demand in Canada is expected to remain strong, supported by continued income growth associated with high commodity prices. Overall, the Bank now projects that the Canadian economy will expand by 1.8 per cent in 2008 and 2.8 per cent in 2009. This implies that the economy will move into excess supply in the second quarter of 2008, and then return to balance in early 2010.
Both core and total CPI inflation are projected to fall below 1 1/2 per cent by the middle of 2008 before returning to 2 per cent by the end of 2009. This primarily reflects the price-level adjustment noted above and, for total inflation, the recent reduction in the GST. Excluding the impact of the GST reduction, total inflation is projected to average close to the 2 per cent target throughout 2008 and 2009.
The risks to the Bank's inflation projection are judged to be roughly balanced. On the upside, there is continued strong momentum in domestic demand growth, and capacity pressures could be stronger than judged, especially if weak productivity growth were to persist. On the downside, the tightening in credit conditions globally and in Canada could be greater and more protracted than assumed, and there could be a more prolonged slowdown in the U.S. economy. As well, competitive pressures in Canada's retail sector could put more downward pressure on prices than assumed.
On 4 December and on 22 January, the Bank lowered its target for the overnight rate by one-quarter of one percentage point, bringing it to 4 per cent. Further monetary stimulus is likely to be required in the near term to keep aggregate supply and demand in balance, and to return inflation to target over the medium term. | https://www.bankofcanada.ca/2008/01/bank-canada-releases-monetary-policy-report-update-6/ | ca | 2008-01-24T05:00:00+00:00 | Bank of Canada releases Monetary Policy Report Update | statements | false | null | 2021-10-18T18:07:16+00:00 |
915fb04ce525-0 | The Bank of Canada today published its 2013 schedule of key policy interest rate announcements and quarterly Monetary Policy Report (MPR) releases, and re-confirmed the scheduled announcement dates for the remainder of this year.
The scheduled announcement dates from September 2012 through December 2012 are re-confirmed as:
Wednesday, 5 September 2012
Tuesday, 23 October 2012
Tuesday, 4 December 2012
All these remaining 2012 rate announcements will continue to be made at 09:00 (ET) and the October Monetary Policy Report will be published at 10:30 (ET) on Wednesday, 24, October 2012.
Starting in January 2013, the Bank of Canada will begin publishing its quarterly Monetary Policy Report concurrently with its January, April, July, and October rate announcements. The standard day for publication of all scheduled rate announcements and MPRs will be Wednesday. A press conference with the Governor and Senior Deputy Governor will continue to take place on the dates when an MPR is published.
The Bank, as always, retains the option of making unscheduled rate announcements at any time in the event of extraordinary circumstances.
Over the past several years, the Bank has streamlined its production processes for the Monetary Policy Report and gradually reduced the interval between the release of the rate decision and the publication of the MPR from two weeks to the current one day. Today’s announcement is the logical conclusion of this process. Publishing the MPR at the same time as the interest rate announcement provides full and immediate context for the rate decision, which improves transparency and helps the Bank explain its monetary policy more effectively.
The scheduled announcement dates for 2013 are:
Wednesday, January 23*
Wednesday, March 6
Wednesday, April 17*
Wednesday, May 29
Wednesday, July 17*
Wednesday, September 4
Wednesday, October 23*
Wednesday, December 4
*- denotes the publication of the Monetary Policy Report.
There will be a single, consistent time of release for all scheduled rate announcements and Monetary Policy Reports. This release time will be determined and announced following consultations with market participants and other stakeholders.
Background and Additional Information:
Timeline of changes to the publication schedule for rate announcements and Monetary Policy Reports:
2000-2001: Fixed Announcement Dates begin in December 2000. Monetary Policy Reports and Updates are published about two weeks after the January, April, July and October announcements.
2002: MPRs and Updates are published one week after the January, April, July and October announcements.
2003: MPRs are published one week after April and October FADs. Updates are published two days after January and July FADs.
2004: MPRs and Updates are published two days after corresponding FADs. | https://www.bankofcanada.ca/2012/08/2013-schedule-policy-interest-rate-announcements-monetary-policy-report/ | ca | 2012-08-20T04:00:00+00:00 | Bank of Canada Publishes 2013 Schedule for Policy Interest Rate Announcements and Monetary Policy Report Releases | statements | false | null | 2021-10-18T18:06:59+00:00 |
afafeee10835-0 | The Bank of Canada today released its October Monetary Policy Report, which discusses current economic and financial trends in the context of Canada's inflation-control strategy.
The global and Canadian economies have continued to grow at a solid pace, and our economy now appears to be operating at full production capacity. Past and recent movements in energy prices and in the exchange rate for the Canadian dollar, along with competitive pressures from China and other newly industrialized economies, are giving rise to significant ongoing adjustments in the Canadian economy. Given these adjustments and the slow growth of productivity in recent years, the Bank has slightly reduced its estimate of potential output growth for 2005 and 2006.
The Bank projects that the economy will grow in line with production potential through 2007, with growth averaging 2.8 per cent this year, 2.9 per cent in 2006, and 3.0 per cent in 2007.
With the economy operating at capacity and with higher energy prices, pressures on consumer prices are somewhat stronger than they were at the time of the July Monetary Policy Report Update. Assuming energy prices evolve in line with currently prevailing futures prices, CPI inflation is projected to average near 3 per cent through the middle of 2006, before returning to the 2 per cent target in the second half of next year. Core inflation should remain below 2 per cent in coming months, returning to 2 per cent by mid-2006.
The Bank raised its key policy interest rate to 3 per cent on 18 October. In line with the Bank's outlook, some further reduction of monetary stimulus will be required to maintain a balance between aggregate supply and demand over the next four to six quarters, and to keep inflation on target. Short-term risks to this projection appear to be balanced. But looking further out to 2007 and beyond, there are increasing risks that the unwinding of global economic imbalances could involve a period of weak world economic growth.
The Bank will continue to assess the adjustments and underlying trends in the Canadian economy, as well as the balance of risks, as it conducts monetary policy to keep inflation on target over the medium term. | https://www.bankofcanada.ca/2005/10/bank-canada-released-monetary-policy-report/ | ca | 2005-10-20T04:00:00+00:00 | Bank of Canada releases Monetary Policy Report | statements | false | null | 2021-10-18T18:07:14+00:00 |
3d855fd5272b-0 | The Bank of Canada today released its July Monetary Policy Report Update, which discusses current economic and financial trends in the context of Canada's inflation-control strategy.
Overall, the Bank's outlook for growth and inflation in Canada is largely unchanged from that in its April Monetary Policy Report (MPR). Growth in the first half of 2006 appears to have been a little stronger than projected, and the Canadian dollar has traded in a higher range than was envisaged in the April MPR. The economy is currently judged to be operating just above its production capacity.
Growth in 2007-08 is expected to be a little weaker than was anticipated in the April MPR, owing primarily to the lagged effects of the higher Canadian dollar. With some anticipated moderation in U.S. growth, combined with past interest rate and exchange rate increases, the Canadian economy is projected to return to its production capacity by the end of 2008.
The Bank projects economic growth of 3.2 per cent in 2006, 2.9 per cent in 2007, and 2.8 per cent in 2008. Total CPI inflation is expected to average just over 1 1/2 per cent from mid-2006 to mid-2007—with the reduction in the GST lowering the inflation rate by 0.6 percentage points over this period—and then return to the 2 per cent target and remain there through the projection period. Core inflation should also remain at about 2 per cent through to the end of 2008.
There are important upside and downside risks to the Bank's projection. But the Bank continues to judge that these risks are roughly balanced, with a small tilt to the downside later in the projection period because of the possibility of a disorderly resolution of global imbalances.
On 11 July, the Bank kept its target for the overnight rate unchanged at 4.25 per cent. The current level of this policy rate is judged, at this time, to be consistent with achieving the inflation target over the medium term. The Bank will continue to monitor global and domestic economic and financial developments, including adjustments in the Canadian economy, relative to its projection. | https://www.bankofcanada.ca/2006/07/bank-canada-releases-monetary-policy-report-update-8/ | ca | 2006-07-13T04:00:00+00:00 | Bank of Canada releases Monetary Policy Report Update | statements | false | null | 2021-10-18T18:06:59+00:00 |
609764935027-0 | The Bank of Canada today released its Update to the October Monetary Policy Report (MPR). The Update discusses current economic and financial trends in the context of Canada's inflation-control strategy.
The Canadian and world economies are evolving essentially in line with the Bank's expectations, and the outlook for growth and inflation in Canada is similar to that in the October MPR. Canada's economy continues to adjust to global developments and to the associated changes in relative prices. The Bank continues to judge that the Canadian economy is operating at its production capacity and will grow roughly in line with its production potential through 2007. Annual GDP growth is expected to be 3.1 per cent this year and 2.9 per cent in 2007, with strong growth in domestic demand and further gains in exports.
Total CPI inflation, which was 2.3 per cent in the fourth quarter of 2005, will continue to be affected by the prices of crude oil and natural gas. The Bank projects that total inflation will be about 2.5 per cent in the first half of 2006, easing to 2 per cent by the first half of 2007. Core inflation, which was 1.6 per cent in the fourth quarter of 2005, should also return to 2 per cent by the first half of next year.
Risks to the Bank's projection remain balanced for 2006. Through 2007 and beyond, risks are tilted to the downside, as the unwinding of global imbalances could involve a slowdown in world economic activity.
In line with the Bank's base-case projection and current assessment of risks, some modest further increase in the policy interest rate would be required to keep aggregate supply and demand in balance and inflation on target over the medium term. | https://www.bankofcanada.ca/2006/01/bank-canada-releases-monetary-policy-report-update-9/ | ca | 2006-01-26T05:00:00+00:00 | Bank of Canada releases Monetary Policy Report Update | statements | false | null | 2021-10-18T18:07:13+00:00 |
610b36a63375-0 | The Bank of Canada today released its Update to the May Monetary Policy Report, in which it discusses economic and financial trends in the context of Canada's inflation-control strategy.
The Bank's outlook for economic activity and inflation has not fundamentally changed from that presented in the May Report. After increasing modestly in the first half of 2001, economic activity in Canada is expected to pick up pace in the second half and to make further gains in 2002. Growth for 2001 is still projected to be in a range between 2 and 3 per cent. The factors that support this outlook continue to include: substantial progress in adjusting inventory levels, a turnaround in business investment, the easing that has taken place in domestic monetary conditions, tax cuts boosting disposable incomes, and the expectation of a modest recovery in U.S. economic growth.
Since January, the Bank has cut the Overnight Rate Target by a total of 150 basis points. This cumulative reduction in interest rates is underpinning domestic economic growth in the face of weak conditions outside North America and uncertainty about the recovery of U.S. business investment spending. These reductions are consistent with keeping inflation close to 2 per cent—the Bank's target rate—over the medium term.
The slowing in economic activity in Canada during the first half of 2001 has eased pressures on capacity and inflation. Core inflation is thus projected to moderate to about 2 per cent in the second half of the year and stay close to that level through 2002. With the recent decline in energy prices, the rate of increase in the total CPI is projected to move down to about 2 per cent by the end of 2001. | https://www.bankofcanada.ca/2001/08/bank-canada-releases-monetary-policy-report-update-12/ | ca | 2001-08-01T04:00:00+00:00 | Bank of Canada releases Monetary Policy Report Update | statements | false | null | 2021-10-18T18:06:58+00:00 |
899dcb0fe3d7-0 | The Bank of Canada today released its Update to the April Monetary Policy Report. The Update discusses current economic and financial trends in the context of Canada's inflation-control strategy.
Since the April Report, three developments have led to small modifications in the Bank's outlook for economic growth and inflation in Canada. First, growth in the first half of 2004 is now estimated to be somewhat higher than was projected in April. Combined with a small upward revision to GDP data for 2003, this implies somewhat less excess supply at mid-year than had been anticipated. Second, higher world oil prices mean that total CPI inflation over the next few quarters will be higher than was projected earlier, although this should not have a significant impact on core inflation. Third, there are signs of some slowing in the U.S. economy.
Higher-than-expected world oil prices mean that total CPI inflation is likely to remain above 2 per cent through the rest of this year, before falling slightly below core inflation in the second half of 2005. Core inflation is projected to remain just above 1.5 per cent for the rest of 2004, before gradually moving back up to the 2 per cent target by the end of 2005.
Economic growth in Canada should average about 3 ½ per cent in the second half of 2004 and in the first half of 2005, before easing to 3 per cent in the second half. This would imply average annual growth of about 2 ¾ per cent in 2004 and 3 ½ per cent in 2005.
This profile suggests that the Canadian economy will reach its production capacity by mid-2005.
As economies approach their production capacity, monetary stimulus must be removed to avoid a buildup of inflation pressures. In Canada, the timing and magnitude of interest rate increases will depend on the evolving prospects for inflation and for pressures on capacity. Three factors will play an important role in this respect. The first is the assessment of the size of the output gap. The second is the future growth of Canadian imports and exports, which is particularly uncertain because of the ongoing adjustments to global changes and the recent patterns in trade growth. The third is the overall effect on Canadian output of movements in the world prices of oil and non-energy commodities. In addition, there continue to be heightened geopolitical concerns. | https://www.bankofcanada.ca/2004/07/bank-of-canada-releases-monetary-policy-report-update-2/ | ca | 2004-07-22T04:00:00+00:00 | Bank of Canada releases Monetary Policy Report Update | statements | false | null | 2021-10-18T18:07:12+00:00 |
050e332cf940-0 | The Bank of Canada today announced that it is maintaining its target for the overnight rate at 2 per cent. The operating band for the overnight rate is unchanged, and the Bank Rate remains at 2 1/4 per cent.
The Bank's outlook for economic growth and core inflation in Canada is little changed from the April Monetary Policy Report. The Canadian economy is judged to be operating slightly closer to full production capacity than had been anticipated in April and is now expected to be at its production potential by mid-2005. Core inflation is still projected to move back up to the 2 per cent inflation target by the end of 2005. However, the short-term projection for total CPI inflation has been raised to reflect higher-than-expected world oil prices.
Against this background, the Bank decided to leave the target for the overnight rate unchanged. The details and analysis of the Bank's outlook and the related issues for monetary policy will be discussed in the Monetary Policy Report Update, to be released on 22 July 2004.
Information note:
The Bank of Canada's next scheduled date for announcing the overnight rate target is 8 September 2004. | https://www.bankofcanada.ca/2004/07/bank-canada-keeps-target-overnight-rate-5/ | ca | 2004-07-20T04:00:00+00:00 | Bank of Canada keeps target for the overnight rate at 2 per cent | statements | false | null | 2021-10-18T18:04:43+00:00 |
9d19d7cb63bc-0 | The Bank of Canada today released its April Monetary Policy Report (MPR), which discusses current economic and financial trends in the context of Canada's inflation-control strategy.
The Canadian economy continues to grow at a solid pace, supported by robust global growth, firm commodity prices, and strong domestic demand. At the same time, global competition and the past appreciation of the Canadian dollar continue to pose challenges for a number of sectors. All factors considered, the Canadian economy is judged to be operating at, or just above, its production capacity.
The Bank projects economic growth of 3.1 per cent in 2006, 3.0 per cent in 2007, and 2.9 per cent in 2008. Total CPI inflation will continue to be volatile and affected by developments in the markets for crude oil and natural gas. The Bank projects that the total CPI will average close to 2 per cent in 2007 and 2008 (excluding the effect of any changes in the GST). Core inflation is projected to rise to 2 per cent in the second half of this year and remain there through the end of 2008.
There are both upside and downside risks to the Bank's outlook for growth and inflation. The Bank judges that these risks are roughly balanced, with a small tilt to the downside later in the projection period.
On 25 April, the Bank raised its target for the overnight rate to 4.0 per cent. In line with the Bank's base-case projection and current assessment of risks, some modest further increase in the policy interest rate may be required to keep aggregate supply and demand in balance and inflation on target over the medium term. The Bank will closely monitor evolving developments in the Canadian economy in light of the cumulative increase in the policy interest rate since last September. | https://www.bankofcanada.ca/2006/04/bank-canada-releases-monetary-policy-report-8/ | ca | 2006-04-27T04:00:00+00:00 | Bank of Canada releases Monetary Policy Report | statements | false | null | 2021-10-18T18:07:09+00:00 |
b86dc486f072-0 | The Bank of Canada today announced that it is lowering the Bank Rate by one-half of one percentage point to 5 1/4 per cent. The operating band for the overnight rate is correspondingly lowered, and the Bank's target for the overnight rate is reduced to 5 per cent.
Since 23 January, the Bank's last fixed announcement date, there have been indications that the slowdown in the U.S. economy in the first half of 2001 could be more pronounced than expected, and there is a risk that weakening confidence could delay the U.S. recovery. In Canada, recent information suggests that the positive underlying momentum in the economy at the end of 2000 was somewhat less strong than had been previously estimated, and that pressures on productive capacity and inflation are lower as a result.
Today's action was taken in light of these developments and related uncertainties. The reduction in interest rates, together with rising disposable incomes bolstered by recent tax reductions, will help to underpin domestic demand. The Bank remains of the view that the overall pace of economic activity in Canada will rebound in the second half of the year. This will lead to a level of economic activity that is consistent with maintaining the core rate of inflation close to 2 per cent, the midpoint of the Bank's 1 to 3 per cent inflation-control target range. Assuming that world energy prices remain around current levels, the Bank continues to expect that the annual rate of increase in the total CPI will move down to about 2 per cent in the second half of this year.
Information note:
The next scheduled date for a Bank Rate announcement is 17 April 2001.
The Monetary Policy Report will be published on 1 May 2001. | https://www.bankofcanada.ca/2001/03/bank-of-canada-lowers-bank-rate-2/ | ca | 2001-03-06T05:00:00+00:00 | Bank of Canada lowers Bank Rate to 5 1/4 per cent | statements | false | null | 2021-10-18T18:04:43+00:00 |
7c11015ab864-0 | The Bank of Canada today released its Update to the April Monetary Policy Report, in which it discusses economic and financial trends in the context of Canada's inflation-control strategy.
Canada's economic recovery, which began in the last quarter of 2001, gathered momentum in the first half of 2002. Over the period to the end of 2003, the Bank projects continued solid economic expansion at an annual rate of 3 to 4 per cent. This will result in growth of close to 3 ½ per cent on an annual average basis in 2002 and in 2003. Both the total and core rates of inflation are projected to be slightly above 2 per cent in the second half of 2002, before steadying out at close to 2 per cent in 2003.
Given that the Canadian economy grew at a faster pace than anticipated in the first half of 2002, there is now less excess capacity than was projected in our April Report. The economy is expected to be operating at full capacity in early 2003—sooner than previously anticipated.
In light of these developments, the Bank has continued to reduce the amount of monetary stimulus in the economy, raising the target for the overnight interest rate by 25 basis points on three occasions—in April, June, and July—to bring the rate to 2 3/4 per cent.
It remains the Bank's view that the underlying economic situation will require further reductions in the amount of monetary stimulus. The timing and pace of policy adjustments will depend on the strength of the various factors at play and their implications for pressures on capacity, and thus on inflation.
There are both upside and downside risks to the outlook for Canadian economic growth. On the positive side, growth of domestic demand could turn out to be stronger than projected because of the substantial amount of monetary stimulus still in place. On the negative side, there are the uncertainties associated with global corporate and financial market developments and their potential effects on confidence and world economic growth. At this time, the risks to our projected rate of growth of 3 to 4 per cent growth appear to be balanced.
As we go forward, the Bank will remain focused on taking actions to achieve the 2 per cent inflation target. Keeping inflation low and stable is the best contribution that monetary policy can make to sustained economic growth in Canada. | https://www.bankofcanada.ca/2002/07/bank-canada-releases-monetary-policy-report-update-11/ | ca | 2002-07-24T04:00:00+00:00 | Bank of Canada Releases Monetary Policy Report Update | statements | false | null | 2021-10-18T18:07:06+00:00 |
ec3128faced7-0 | The Bank of Canada today announced that it is maintaining its target for the overnight rate at 2 3/4 per cent. The operating band for the overnight rate is unchanged, and the Bank Rate remains at 3 per cent.
Recent economic developments bearing on the prospects for economic activity and inflation in Canada reflect a number of cross-currents. Core and total CPI inflation have fallen below the 2 per cent inflation target and are poised to move lower in the short run. Economic growth in Canada in the third quarter was below expectations, owing principally to a sharp inventory correction. At the same time, final domestic demand remained strong, buoyed by vigorous household spending and a solid pickup in business investment. The U.S. economy has exhibited exceptional growth and overseas economies have been growing more strongly than expected, although this growth has yet to show up in Canada's export performance.
As a result of weak growth in Canada in the third quarter and downward revisions to growth rates in the first and second quarters of 2003, the output gap is now larger than the Bank had estimated in the October Monetary Policy Report. Therefore, stronger expansion than previously projected will be required in the fourth quarter of 2003 and through 2004 if the output gap is to be closed by early 2005, consistent with returning inflation to the target by mid-2005.
At this time, the Bank expects Canada's economic growth in the fourth quarter to rebound strongly from the effects of the August power outage in Ontario and from the inventory correction; the Bank also expects an increase in exports reflecting strong U.S. expansion. However, there is uncertainty about the extent to which the appreciation of the Canadian dollar will offset the effects of stronger world demand for Canadian goods and services, and whether the amount of monetary stimulus currently in the economy will support an increase in business investment and household spending sufficient to close the output gap by early 2005.
Given the information currently available, the Bank has decided to leave policy interest rates unchanged at this time. The Bank will watch closely for evidence that aggregate demand and output are expanding at a rate solidly above the growth of potential.
Information note:
The Bank of Canada's next scheduled date for announcing the overnight rate target is 20 January 2004.
The Monetary Policy Report Update will be published on 22 January 2004. | https://www.bankofcanada.ca/2003/12/bank-canada-keeps-target-overnight/ | ca | 2003-12-02T05:00:00+00:00 | Bank of Canada keeps target for the overnight rate at 2 3/4 per cent | statements | false | null | 2021-10-18T18:04:41+00:00 |
440ef3c77cb1-0 | The Bank of Canada today released its Update to the November Monetary Policy Report, in which it discusses economic and financial trends in the context of Canada's inflation-control strategy.
While robust growth is not yet underway, geopolitical developments have evolved positively, and consumer confidence has improved. Thus, the likelihood that economic growth in 2002 will strengthen as the year progresses has increased. Business confidence, however, remains weak in many countries, with the timing and strength of the recovery in global business investment being the major area of uncertainty for the outlook.
The profile for economic growth in Canada provided in the Update indicates that the amount of economic slack through 2002 will likely be somewhat greater than anticipated last November. With greater economic slack, core inflation is now expected to average just under 1 ½ per cent in the second half of 2002. Total inflation should remain below core inflation until late 2002, if world energy prices increase only moderately from the current levels.
By lowering its target for the overnight interest rate a further 75 basis points since the November Report, for a cumulative decline of 375 basis points over the past twelve months, the Bank has taken vigorous action to support growth in domestic demand. As a result, economic slack should start to diminish in the second half of 2002, as the economy begins to expand at rates above that of potential output, and would be expected to disappear by late 2003. Consequently, both core and total CPI inflation should be back close to 2 per cent in about two years. | https://www.bankofcanada.ca/2002/01/bank-of-canada-releases-monetary-policy-report-update-4/ | ca | 2002-01-23T05:00:00+00:00 | Bank of Canada releases Monetary Policy Report Update | statements | false | null | 2021-10-18T18:07:05+00:00 |
7894292afb52-0 | The Bank of Canada today announced that it is maintaining its target for the overnight rate at 2 1/2 per cent. The operating band for the overnight rate is unchanged, and the Bank Rate remains at 2 3/4 per cent.
Global and Canadian economic data received since the last interest rate announcement on 12 April have been broadly in line with expectations. The Bank's outlook for the Canadian economy through to the end of 2006 is unchanged from that in the April Monetary Policy Report (MPR). Growth this year and next is still expected to come primarily from domestic demand. Consistent with the analysis in the MPR, the Canadian economy is expected to move back to its production capacity in the second half of 2006, with core inflation projected to return to 2 per cent around the end of next year. In line with this outlook, a reduction of monetary stimulus will be required over time.
The outlook remains subject to both upside and downside risks. These risks relate largely to global developments, the associated relative price changes, and the adjustment of the Canadian economy.
Information note:
The Bank of Canada's next scheduled date for announcing the overnight rate target is 12 July 2005.
The Monetary Policy Report Update will be published on 14 July 2005. | https://www.bankofcanada.ca/2005/05/bank-canada-keeps-target-overnight-rate-7/ | ca | 2005-05-25T04:00:00+00:00 | Bank of Canada keeps target for the overnight rate at 2 1/2 per cent | statements | false | null | 2021-10-18T18:04:40+00:00 |
a9b17fd87399-0 | Today, we released our October Monetary Policy Report. The Report reviews economic and financial trends in the context of Canada's inflation-control strategy.
Since our April Report, the Canadian economy has been hit by a number of unusual shocks: SARS, BSE, the Ontario electricity blackout, and the severe forest fires in British Columbia. Inflation has also fallen faster and further than expected. This drop in core inflation reflected several unforeseen developments. These included a broad-based weakness in the prices of goods, substantial reductions in the prices of tourism-related services because of SARS, and a slightly faster easing of pressures from auto insurance premiums. The substantial fall in the value of the U.S. dollar added to the weakness in goods prices. We now estimate that there is more slack in the economy than was projected in April.
The prospects for near-term growth in the global economy have improved since April, and geopolitical uncertainty has continued to decrease. The near-term outlook for the U.S. economy is much improved. The economy in the euro area is still weak, but prospects for Asia look bright, led by China and India. The Japanese economy is performing better than anticipated.
We expect growth in the Canadian economy to strengthen during the fourth quarter and through 2004. On balance, the expansion should be above the rate of potential growth, relying primarily on solid household spending and increased business investment. Stronger growth abroad should boost foreign demand for Canadian products, but this will be dampened by the higher value of the Canadian dollar. Growth is expected to average a little over 3 per cent in the second half of 2003 and 3 1/4 per cent in 2004. With growth above potential, the slack in the economy should be absorbed by early 2005.
We expect core inflation to average just over 1.5 per cent for the rest of 2003, and to fall to just above 1 per cent in early 2004, as the effects of earlier increases in auto insurance premiums dissipate. Core inflation should return to 2 per cent by mid-2005, as economic slack is taken up. Total CPI inflation will continue to be importantly affected by swings in the price of crude oil. If prices ease to US$27 per barrel next year, total CPI inflation would likely fall below core inflation in 2004.
However, there are significant risks to this economic outlook. These risks relate to the timing and magnitude of global demand, price, and exchange rate adjustments to economic imbalances. In particular, there is uncertainty both about the likely changes in key global exchange rates and their effect on the Canadian economy. There is also uncertainty about the sustainability of U.S. growth beyond mid-2004.
We continue to assess the implications of all these developments—both past and future—for output and inflation in Canada, and what this means for monetary policy. | https://www.bankofcanada.ca/2003/10/release-of-the-monetary-policy-report/ | ca | 2003-10-22T04:00:00+00:00 | Release of the Monetary Policy Report | statements | false | null | 2021-10-18T18:07:04+00:00 |
664b4433f980-0 | The Bank of Canada today announced that it is lowering its target for the overnight rate by one-quarter of one percentage point to 4 per cent. The operating band for the overnight rate is correspondingly lowered, and the Bank Rate is now 4 1/4 per cent. With today's action, the total reduction in interest rates by the Bank this year amounts to 1 3/4 percentage points.
Economic data released since the Bank's last policy interest rate announcement on 17 July suggest that the pace of growth of the Canadian economy has been slower than expected. In part, this slowing reflects reduced demand from abroad for Canadian manufactured goods and primary products. The most important factor in this regard has been the ongoing weakness in the U.S. economy, particularly in capital spending. As well, economic growth outside North America has slowed significantly. Within Canada, growth in final domestic demand has softened, and the adjustment of inventory levels in some sectors, especially in telecommunications manufacturing, is not as far advanced as had been expected.
As a consequence of these developments, the Bank now expects economic growth in the third and fourth quarters of this year to be below potential, resulting in a lower level of activity than earlier expected. This implies reduced pressures on production capacity and inflation through the rest of this year and into 2002.
In July, total CPI inflation fell sharply to 2.6 per cent, largely because of declines in gasoline and natural gas prices. While core inflation increased slightly, to 2.4 per cent, the Bank still projects consumer price inflation to fall to about 2 per cent by the end of the year as a result of reduced pressures in product and labour markets.
In these conditions of slower-than-expected growth and associated easing in inflation pressures, today's interest rate reduction, together with the monetary stimulus already in place, is intended to provide support for domestic demand growth. This is expected to contribute to moving the economy, in the second half of next year, back towards levels of activity consistent with keeping inflation near the Bank's target of 2 per cent. Given the continuing uncertainties in the global economy, particularly the timing and strength of the recovery in investment in the United States, as well as uncertainty surrounding domestic demand in Canada, the Bank will continue to monitor developments closely.
Information note:
The Bank's next scheduled date for announcing policy interest rates is 23 October 2001. | https://www.bankofcanada.ca/2001/08/bank-of-canada-lowers-key-policy-3/ | ca | 2001-08-28T04:00:00+00:00 | Bank of Canada lowers key policy interest rate by 1/4 percentage point to 4 per cent | statements | false | null | 2021-10-18T18:04:39+00:00 |
2124daedb3a3-0 | The Bank of Canada today released the October Monetary Policy Report, which discusses current economic and financial trends in the context of Canada's inflation-control strategy.
The Canadian economy is judged to be operating just above its production capacity. While global economic growth is expected to be a little higher than previously anticipated, a weaker near-term outlook for the U.S. economy has curbed the near-term prospects for Canadian exports and growth. The Bank's outlook for growth in the Canadian economy has been revised down slightly from that outlined in July's Monetary Policy Report Update. The Bank's base-case projection now calls for average annual GDP growth of 2.8 per cent in 2006, 2.5 per cent in 2007, and a return to 2.8 per cent in 2008. Weakness in labour productivity growth has led the Bank to lower its assumption for potential growth to 2.8 per cent for the 2006-08 period. Together, these factors imply that the small amount of excess demand now in the economy will be eliminated by mid-2007.
Core inflation is expected to move a bit above 2 per cent in the coming months but return to the 2 per cent target by the middle of 2007 and remain there through 2008. Lower energy prices have led to a downward revision to the near-term projection for total CPI inflation. Total inflation (which includes the temporary impact of the GST reduction) will likely average about 1 1/2 per cent through the second quarter of 2007, before returning to the 2 per cent target and remaining there through to the end of 2008.
As the Bank noted at the time of its 6 September interest rate announcement, the risks around the base-case projection are judged to be a little greater than at the time of the July Update. The main upside risk relates to the momentum in household spending and housing prices, while the main downside risk is that the U.S. economy could slow more sharply than expected, leading to lower Canadian exports. The Bank judges that the risks to its inflation projection are roughly balanced.
On 17 October, the Bank left its key policy rate unchanged at 4.25 per cent. The current level is judged, at this time, to be consistent with achieving the inflation target over the medium term. | https://www.bankofcanada.ca/2006/10/bank-canada-releases-monetary-policy-report-3/ | ca | 2006-10-19T04:00:00+00:00 | Bank of Canada releases Monetary Policy Report | statements | false | null | 2021-10-18T18:07:04+00:00 |
919d7be1dece-0 | The Bank of Canada today announced that it is raising its target for the overnight rate by one-quarter of one percentage point to 2 1/2 per cent. The operating band for the overnight rate is correspondingly increased, and the Bank Rate is now 2 3/4 per cent.
The Canadian economy is operating near its production capacity and continues to adjust to global economic developments. Recently, world oil prices have risen well above the Bank's earlier assumptions and the Canadian dollar has appreciated further.
Looking ahead over the period to the end of 2006, the Bank's base-case projection calls for aggregate demand for Canadian goods and services to expand, on average, at about the same rate as potential output. Given the effects of higher oil prices and the past appreciation of the Canadian dollar, the Bank projects growth to be slightly less than 3 per cent in 2005, and slightly more than 3 per cent in 2006. With the economy expected to remain near its production capacity throughout this period, core inflation is projected to move back to the 2 per cent target by the end of 2005. Reflecting higher world oil prices, total CPI inflation is projected to move well above core inflation in the first half of 2005 and fall slightly below core inflation in 2006.
Against this background, the Bank decided to raise its target for the overnight rate. Further reduction of monetary stimulus will be required over time to keep inflation on target, with the pace depending on the Bank's continuing assessment of the prospects for factors that affect pressures on capacity and, hence, inflation. The details of the Bank's outlook for output and inflation and an analysis of the significant risks and uncertainties associated with this outlook will be discussed in the Monetary Policy Report, to be released on 21 October 2004.
Information note:
The Bank of Canada's next scheduled date for announcing the overnight rate target is 7 December 2004. | https://www.bankofcanada.ca/2004/10/bank-canada-raises-overnight-rate-target-2/ | ca | 2004-10-19T04:00:00+00:00 | Bank of Canada raises overnight rate target by 1/4 percentage point to 2 1/2 per cent | statements | false | null | 2021-10-18T18:04:38+00:00 |
f58f15a5508c-0 | The Bank of Canada today released its thirteenth semi-annual Monetary Policy Report in which it discusses economic and financial trends in the context of Canada's inflation-control strategy. The Monetary Policy Report is published every May and November.
At this time, the key issue in the conduct of monetary policy in Canada is the extent of the current slowdown in the pace of economic activity stemming primarily from developments in the United States.
The slowdown in the U.S. economy has been greater than anticipated, but a strengthening is expected in the second half of 2001. Europe continues to exhibit positive momentum although at a slower pace. Emerging-market economies have been adversely affected by the U.S. slowdown. In Japan, the economy remains weak.
After slowing in the first half of 2001, economic growth in Canada is expected to pick up in the second half and rise somewhat further in 2002 to slightly above the economy's growth potential. This view reflects several factors: a second-half pickup in U.S. growth, completion of the current inventory correction, continued investment in new technology by businesses, recent tax cuts, and the easing in domestic monetary conditions.
Since January, the Bank has cut the Bank Rate by a total of 100 basis points to support growth in aggregate demand. This reduction in interest rates was consistent with the Bank's policy objective of keeping inflation close to the 2 per cent midpoint of its 1 to 3 per cent target range over the medium term.
Because of slowing activity and associated movement towards a position of excess supply, core inflation will likely average somewhat below 2 per cent over the remainder of 2001. It is expected to move back to 2 per cent by the end of 2002 as the economy grows above potential. The rate of increase in the total CPI is expected to be volatile over the next few months, before moving down to 2 per cent by the end of 2001 if world energy prices remain close to current levels.
The main risk to this outlook for the Canadian economy is the timing and strength of the projected pickup in U.S. growth. The Bank will continue to monitor developments in this area closely. | https://www.bankofcanada.ca/2001/05/bank-canada-releases-semi-annual-monetary-policy-report/ | ca | 2001-05-01T04:00:00+00:00 | Bank of Canada releases semi-annual Monetary Policy Report | statements | false | null | 2021-10-18T18:07:03+00:00 |
6762ca6aed56-0 | The Bank of Canada today announced that it is lowering the Bank Rate by one-quarter of one percentage point to 5 per cent. The operating band for the overnight rate is correspondingly lowered, and the Bank's target for the overnight rate is reduced to 4 3/4 per cent.
Since late 2000, the pace of economic expansion in Canada has slowed to a rate below the economy's long-run growth potential. Information received since 6 March, the Bank's last fixed announcement date, confirms that this slowing is broadly in line with the Bank's expectations. The slowdown has largely been a consequence of the marked easing in the pace of U.S. economic growth, while final domestic demand has maintained its underlying momentum. Overall, the Canadian economy is expected to be operating somewhat below capacity by the middle of 2001, putting downward pressure on inflation. Core inflation, currently 2 per cent, is thus expected to ease. The rate of increase in the total CPI, currently close to 3 per cent, is expected to move down to 2 per cent by the end of 2001.
In light of the slowing pace of growth and the movement towards a position of excess supply, today's interest rate reduction, together with earlier reductions announced in January and March, is intended to support growth in aggregate demand, consistent with the Bank's policy objective of keeping inflation close to the midpoint of its 1 to 3 per cent target range over the medium term.
It remains the Bank's view that, following the slowdown in the first half of this year, Canada's economic growth will strengthen in the second half and in 2002. This expected pickup reflects a number of factors, including completion of the current inventory adjustment, continuing investment in new technology, recent tax cuts, the easing in domestic monetary conditions and, most importantly, the resumption of stronger U.S. economic growth. Given the uncertainties related to the timing and strength of the U.S. rebound, the Bank will continue to monitor developments closely.
Information note:
A detailed explanation of the Bank's views on the economy and the outlook for inflation will be set out in the Monetary Policy Report to be published on 1 May 2001.
The next scheduled date for a Bank Rate announcement is 29 May 2001. | https://www.bankofcanada.ca/2001/04/bank-of-canada-lowers-bank-rate-3/ | ca | 2001-04-17T04:00:00+00:00 | Bank of Canada lowers Bank Rate by 1/4 per cent | statements | false | null | 2021-10-18T18:04:34+00:00 |
697a08fe843f-0 | The Bank of Canada today released its October Monetary Policy Report, which discusses current economic and financial trends in the context of Canada's inflation-control strategy.
There have been a number of significant economic and financial developments since the July Monetary Policy Report Update. Against a backdrop of robust global economic expansion and strong commodity prices, the Canadian economy has been stronger than projected and is now operating further above its production potential than had been previously expected.
Since the July Update, the outlook for the U.S. economy has weakened. The Canadian dollar has appreciated sharply, and credit conditions have tightened. Despite these tighter credit conditions, the momentum of domestic demand in Canada is expected to remain strong. The combined effect of a weaker U.S. outlook and a higher assumed level for the Canadian dollar implies, however, that net exports will exert a more significant drag on the economy in 2008 and 2009 than previously expected. As a result, Canada's gross domestic product is projected to grow by 2.6 per cent in 2007, 2.3 per cent in 2008, and 2.5 per cent in 2009.
With the economy moving back towards balance, and with the direct effect of the stronger Canadian dollar on consumer prices, core inflation is projected to gradually decline to 2 per cent in the second half of 2008. Total CPI inflation is expected to peak at about 3 per cent later this year and then move back down to the 2 per cent target in the second half of 2008.
But there are a number of upside and downside risks to the Bank's inflation projection. The main upside risk is that excess demand in the Canadian economy could persist longer than projected. The main downside risk is that output and inflation could be lower if the Canadian dollar were to be persistently higher than the assumed average level of 98 cents U.S. for reasons not associated with demand for Canadian products.
All factors considered, the Bank judges that the risks to its inflation projection are roughly balanced, with perhaps a slight tilt to the downside.
Against this backdrop, the Bank left its key policy rate unchanged on 5 September and 16 October at 4.50 per cent. The Bank judges, at this time, that the current level of the target for the overnight rate is consistent with achieving the inflation target over the medium term. | https://www.bankofcanada.ca/2007/10/bank-of-canada-releases-monetary-policy-report-2/ | ca | 2007-10-18T04:00:00+00:00 | Bank of Canada releases Monetary Policy Report | statements | false | null | 2021-10-18T18:07:02+00:00 |
ee1f34ad85b1-0 | The Bank of Canada today announced that it is raising its target for the overnight rate by one-quarter of one percentage point to 2 1/2 per cent. The operating band for the overnight rate is correspondingly increased, and the Bank Rate is now 2 3/4 per cent.
Information received since the Bank's last interest rate announcement on 16 April indicates that the economic recovery in Canada has been somewhat stronger than anticipated. And core inflation in April rose to 2.2 per cent, slightly above the level that had been projected. Total CPI inflation was 1.7 per cent.
Today's interest rate increase represents a further reduction in the substantial amount of monetary stimulus in the economy. Going forward, with the economy showing strong momentum and moving back towards full production capacity more quickly than had been expected, the Bank will take the action necessary to keep inflation at its 2 per cent target over the medium term. This will contribute to sustaining economic activity at full capacity.
Information note:
The Bank's next scheduled date for announcing policy interest rates is 16 July 2002.
The Monetary Policy Report Update will be published on 24 July 2002. | https://www.bankofcanada.ca/2002/06/bank-of-canada-raises-overnight-rate-target/ | ca | 2002-06-04T04:00:00+00:00 | Bank of Canada raises overnight rate target by 1/4 percentage point to 2 1/2 per cent | statements | false | null | 2021-10-18T18:04:33+00:00 |
1f0bbb538ac9-0 | The Bank of Canada today released its July Monetary Policy Report Update. In it, the Bank described three major developments affecting the Canadian economy: protracted weakness in the U.S. economy, ongoing turbulence in global financial markets, and sharp increases in the prices of certain commodities, particularly energy. While the first two developments are evolving roughly in line with expectations outlined in the April Monetary Policy Report, many commodity prices continue to outpace earlier expectations, which has altered the outlook for global and domestic inflation.
The Update noted that although economic growth in Canada in the first quarter of 2008 was weaker than expected, final domestic demand – supported by strong terms of trade – continued to expand at a solid pace. The Canadian economy is judged to have moved into slight excess supply in the second quarter of 2008. Excess supply is expected to increase through the balance of the year. High terms of trade, accommodative monetary policy, and a gradual recovery in the U.S. economy are expected to generate above-potential economic growth starting early next year, bringing the economy back to full capacity around mid-2010.
Assuming energy prices follow current futures prices, total CPI inflation is projected to rise temporarily above 4 per cent, peaking in the first quarter of 2009. As energy prices stabilize and with medium-term inflation expectations remaining well anchored, total inflation is projected to converge to the core rate of inflation at the 2 per cent target in the second half of 2009. Core inflation is projected to remain well contained.
The three major developments affecting the Canadian economy pose significant upside and downside risks to the projection. On the upside, domestic demand could be greater than projected, potential output growth could be lower than assumed, and global inflationary pressures could lead to higher-than-projected import costs for Canada. On the downside, commodity prices could be weaker than assumed, U.S. growth could be weaker than expected, and continued strains in global financial markets could have a greater-than-projected impact on global growth and the cost and availability of credit in Canada. Weighing the implications of these considerations, the Bank views the risks to its projection for inflation as balanced.
Against this backdrop, the Bank judges that the current level of the target for the overnight rate – 3 per cent – remains appropriate. The Bank will continue to monitor carefully the evolution of risks, together with economic and financial developments in the Canadian and global economies, and set monetary policy consistent with achieving the 2 per cent inflation target over the medium term. | https://www.bankofcanada.ca/2008/07/bank-canada-releases-monetary-policy-report-update-5/ | ca | 2008-07-17T04:00:00+00:00 | Bank of Canada releases Monetary Policy Report Update | statements | false | null | 2021-10-18T18:07:01+00:00 |
10320f94974b-0 | The Bank of Canada today announced that it is maintaining its target for the overnight rate at 2 1/2 per cent. The operating band for the overnight rate is unchanged, and the Bank Rate remains at 2 3/4 per cent.
The Canadian economy continues to adjust to major global developments. Recent data suggest that Canada's economic growth in the fourth quarter of 2004 was marginally weaker than previously expected, owing partly to a somewhat more pronounced adjustment to the past appreciation of the Canadian dollar. Since the December fixed announcement date, the Canadian dollar has continued to trade in a higher range than was observed prior to the October Monetary Policy Report (MPR). In large part reflecting the consequences for aggregate demand of this higher exchange rate, the Bank now expects the Canadian economy to operate a little further below its full production capacity in 2005 than was anticipated in the last MPR. Against this background, the Bank decided to leave the target for the overnight rate unchanged.
The Monetary Policy Report Update, to be released on 27 January 2005, will provide details of the Bank's outlook for economic growth and inflation through 2006, including the attendant risks and uncertainties, and will consider the related issues for monetary policy.
Information note:
The Bank of Canada's next scheduled date for announcing the overnight rate target is 1 March 2005. | https://www.bankofcanada.ca/2005/01/bank-canada-keeps-target-for-overnight-rate/ | ca | 2005-01-25T05:00:00+00:00 | Bank of Canada keeps target for the overnight rate at 2 1/2 per cent | statements | false | null | 2021-10-18T18:04:32+00:00 |
c11a8665c75b-0 | The Bank of Canada today released its April Monetary Policy Report, which discusses current economic and financial trends in the context of Canada's inflation-control strategy.
The global economy has been unfolding largely as expected, and the outlook for the Canadian economy is essentially unchanged from that in the January Monetary Policy Report Update. There is increasing evidence that the Canadian economy is adjusting to major global developments, including the realignment of currencies and higher commodity prices.
The Bank expects Canada's economy to grow by about 2 1/2 per cent in 2005 and 3 1/4 per cent in 2006, with growth coming primarily from strength in domestic demand. To continue to support aggregate demand, the Bank decided to leave the target for the overnight rate unchanged at 2.5 per cent on 12 April.
The Bank continues to judge that the economy is operating slightly below its production capacity, and to expect that it will move back to full capacity in the second half of 2006. Core inflation is expected to return to 2 per cent around the end of 2006. Based on the scenario implied by oil-price futures, total CPI inflation is projected to remain slightly above 2 per cent this year and to move slightly below 2 per cent in the second half of 2006. In line with this outlook for growth and inflation, a reduction of monetary stimulus will be required over time.
This outlook is subject to both upside and downside risks and to uncertainties. The risks include the pace of expansion in Asia and the prices of oil and non-energy commodities. A further risk relates to the resolution of global current account imbalances. Most of the uncertainties with respect to the Canadian outlook relate to how the economy is adjusting to the relative price changes associated with major global developments. | https://www.bankofcanada.ca/2005/04/bank-canada-releases-monetary-policy-report-9/ | ca | 2005-04-14T04:00:00+00:00 | Bank of Canada releases Monetary Policy Report | statements | false | null | 2021-10-18T18:07:00+00:00 |
43dfdc7d2455-0 | The Bank of Canada today announced that it is maintaining its target for the overnight rate at 4 1/4 per cent. The operating band for the overnight rate is unchanged, and the Bank Rate remains at 4 1/2 per cent.
Since the July Monetary Policy Report Update (MPRU), total CPI inflation, excluding the temporary effect of the GST reduction, has been above 2 per cent and domestic demand has continued to grow at a robust pace. However, GDP growth over the second and third quarters of 2006 has been weaker than expected, largely because of weaker net exports. Labour productivity growth has also been somewhat lower than expected. All factors considered, the Bank judges that the Canadian economy continues to operate just above its production capacity.
Although global economic growth is expected to be a little higher than previously anticipated, a weaker short-term outlook for the U.S. economy has curbed the near-term prospects for Canadian exports and growth. As well, given developments in labour productivity growth, the Bank has reduced its assumption for potential growth to 2.8 per cent for the 2006-2008 period. As a result of these factors, the Bank has revised its projection for economic growth in Canada to 2.8 per cent this year, 2.5 per cent in 2007, and 2.8 per cent in 2008. This growth profile implies that the small amount of excess demand now in the economy will be eliminated by the second half of 2007, and that the economy will then remain roughly in balance through to the end of the projection period. Consistent with this profile, core inflation is expected to move slightly above 2 per cent in coming months, and to return to 2 per cent by the middle of 2007. Lower energy prices have led to a downward revision to the near-term projection for total CPI inflation. Total inflation (which includes the temporary impact of the GST reduction) will likely average about 1 1/2 per cent through to the second quarter of 2007, before returning to the 2 per cent target and remaining there through to the end of 2008.
In line with this updated outlook, the current level of the target for the overnight rate is judged at this time to be consistent with achieving the inflation target over the medium term.
As the Bank indicated in its 6 September interest rate press release, risks around the base-case projection are judged to be a little greater than they were at the time of the July MPRU. The main upside risk relates to the momentum in household spending and housing prices. The main downside risk is that the U.S. economy could slow more sharply than expected, leading to lower Canadian exports. It is the Bank's judgment that, overall, risks around the inflation projection are roughly balanced. The Bank will continue to pay close attention to the evolution of risks, together with economic and financial developments in the Canadian and global economies.
A full analysis of economic developments, trends, and risks will be set out in the Monetary Policy Report, to be published on 19 October 2006.
Information note:
The Bank of Canada's next scheduled date for announcing the overnight rate target is 5 December 2006. | https://www.bankofcanada.ca/2006/10/bank-canada-keeps-target-overnight-3/ | ca | 2006-10-17T04:00:00+00:00 | Bank of Canada keeps target for the overnight rate at 4 1/4 per cent | statements | false | null | 2021-10-18T18:04:30+00:00 |
34884f6c7d59-0 | The Bank of Canada today announced that it is lowering its target for the overnight rate by one-half of one percentage point to 3 1/2 per cent. The operating band for the overnight rate is correspondingly lowered, and the Bank Rate is now 3 3/4 per cent.
The tragic acts of terrorism in the United States on 11 September may pose significant challenges to consumer and business confidence in the United States, Canada, and elsewhere. Accordingly, the Bank is taking this action today to underpin confidence and provide further support for economic growth in Canada. The Bank's decision to act outside of its normal schedule of announcement dates reflects the need for prompt action to counteract potential effects on confidence in the aftermath of the extraordinary events in the United States.
Information note:
The Bank's next scheduled date for announcing policy interest rates is 23 October 2001. | https://www.bankofcanada.ca/2001/09/bank-canada-lowers-key-policy/ | ca | 2001-09-17T04:00:00+00:00 | Bank of Canada lowers key policy interest rate by 1/2 percentage point to 3 1/2 per cent | statements | false | null | 2021-10-18T18:04:42+00:00 |
2ae5acb312a6-0 | The Bank of Canada today announced that it is maintaining its target for the overnight rate at 4 1/4 per cent. The operating band for the overnight rate is unchanged, and the Bank Rate remains at 4 1/2 per cent.
The Bank's outlook for Canadian economic growth and inflation in 2007-2008 is essentially unchanged from that set out in the October Monetary Policy Report (MPR). Global growth has been strong, commodity prices have remained high, and employment growth in Canada and the United States has been sustained. Some recent indicators suggest that output growth in Canada and the United States in the fourth quarter of 2006 may be a little weaker than previously expected. Inflation in Canada has evolved broadly in line with the Bank's expectations.
All things considered, both total CPI and core inflation in Canada are still projected to converge at 2 per cent in the second half of 2007. In line with the Bank's outlook, the current level of the target for the overnight rate is judged at this time to be consistent with achieving the inflation target over the medium term.
The principal risks remain those identified in the October MPR. The main upside risk relates to the momentum in household spending and housing prices. The main downside risk is that the U.S. economy could slow more sharply than expected, leading to lower Canadian exports. The Bank judges that, overall, risks around the inflation projection are roughly balanced. The Bank will continue to pay close attention to the evolution of risks, together with economic and financial developments in the Canadian and global economies. A full analysis of economic developments, trends, and risks will be outlined in the Monetary Policy Report Update, to be published on 18 January 2007.
Information note:
The Bank of Canada's next scheduled date for announcing the overnight rate target is 16 January 2007. | https://www.bankofcanada.ca/2006/12/bank-canada-keeps-target-overnight-5/ | ca | 2006-12-05T05:00:00+00:00 | Bank of Canada keeps target for the overnight rate at 4 1/4 per cent | statements | false | null | 2021-10-18T18:04:29+00:00 |
3efe588be454-0 | The Bank of Canada today announced that it is lowering its target for the overnight rate by one-quarter of one percentage point to 3 per cent. The operating band for the overnight rate is correspondingly lowered, and the Bank Rate is now 3 1/4 per cent.
In recent months, there have been a number of unanticipated developments that bear on the outlook for inflation and economic activity in Canada. Both inflation and inflation expectations have declined more rapidly than the Bank had expected. Near-term domestic economic activity has been undercut by the effects of Severe Acute Respiratory Syndrome (SARS) and an isolated case of Bovine Spongiform Encephalopathy (BSE) in Canada. Foreign demand for Canadian products has also been weaker than earlier anticipated. In addition, the rapid and sizable appreciation of the Canadian dollar against the U.S. currency will tend to have a dampening effect on the demand for tradable Canadian goods and services.
In this context, inflation pressures have eased and more economic slack is opening up in Canada than was previously projected. Today's interest rate reduction will provide support for domestic demand growth, and consequently for levels of aggregate demand consistent with keeping inflation on a track to meet the 2 per cent target over the medium term.
Looking ahead, the Bank still expects that growth in the Canadian economy will strengthen towards the end of 2003 and through 2004, underpinned by domestic demand, by the favourable conditions in capital markets, and by the anticipated rebound in the U.S. economy. An elaboration of the Bank's views on the economy and the outlook for inflation will be provided in the Monetary Policy Report Update, to be released this Thursday, 17 July.
Information note:
The Bank of Canada's next scheduled date for announcing the overnight rate target is 3 September 2003. | https://www.bankofcanada.ca/2003/07/bank-canada-lowers-target-overnight-rate-2/ | ca | 2003-07-15T04:00:00+00:00 | Bank of Canada lowers target for the overnight rate by 1/4 percentage point to 3 per cent | statements | false | null | 2021-10-18T18:04:39+00:00 |
fa97af073377-0 | The Bank of Canada today announced that it is raising its target for the overnight rate by one-quarter of one percentage point to 2 1/4 per cent. The operating band for the overnight rate is correspondingly increased, and the Bank Rate is now 2 1/2 per cent.
The accumulated information since the beginning of the year continues to indicate stronger-than-expected economic growth in Canada and the United States. A robust recovery appears to be underway in Canada. At the same time, there are uncertainties with respect to the continued strength of household spending, the timing and strength of the recovery in business fixed investment, and the implications for the global economy of recent developments in the Middle East. In February, core inflation rose to 2.2 per cent, somewhat above the level projected for the next few months. Total CPI inflation was 1.5 per cent.
With today's interest rate increase, the Bank is modestly reducing the amount of monetary stimulus in the economy. Substantial monetary stimulus remains in place to support continuing economic growth. This is consistent with keeping inflation at its 2 per cent target over the medium term. Details of the Bank's views on the economy and the outlook for inflation will be presented in the Monetary Policy Report, to be published on 24 April 2002.
Information note
The Bank's next scheduled date for announcing policy interest rates is 4 June 2002. | https://www.bankofcanada.ca/2002/04/bank-of-canada-raises-overnight-rate/ | ca | 2002-04-16T04:00:00+00:00 | Bank of Canada raises overnight rate target by 1/4 percentage point to 2 1/4 per cent | statements | false | null | 2021-10-18T18:04:28+00:00 |
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