Loonie Drops to 7-Month Low After Bank of Canada Holds Rates
- Central bank sees lower growth and higher inflation next year
- Israel-Hamas war is a risk to inflation fight: policymakers
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The Bank of Canada kept interest rates unchanged for a second straight meeting, but left the door open to more tightening even as officials forecast weaker economic growth.
Policymakers led by Governor Tiff Macklem held the benchmark overnight lending rate at 5% on Wednesday, the highest level in 22 years. The pause was expected by markets and economists, and marks the fourth time officials sat on the sidelines during this rate cycle, in which borrowing costs have jumped 475 basis points.