Canada Raises Key Rate, Says Domestic Spending Strong

The Bank of Canada raised its benchmark interest rate today for a third time this year, and said it expects households and businesses to spend even as the outlook for the U.S. economy weakens.

The bank raised its target rate for overnight loans between commercial banks to 1 percent from 0.75 percent, matching estimates from 14 of 20 economists surveyed by Bloomberg. While the country’s recovery will be “slightly” slower than it had projected because of a weaker outlook for the U.S. economy, inflation is in line with expectations, it said.