While it is widely expected that the Bank of Canada will maintain its policy interest rate at 1% next week, with the same decision now likely at the next meeting in April too, we still think that the longer-term consensus view regarding interest rates is too high. As economic growth slows and unemployment rises this year and next, more policy stimulus will eventually be needed. Although we now expect interest rate cuts to occur later in the year, we still expect the policy interest rate to end this year at 0.50%, where we expect rates to remain throughout 2013.
Become a client to read more
This is premium content that requires an active Capital Economics subscription to view.
Already have an account?
You may already have access to this premium content as part of a paid subscription.
Sign in to read the content in full or get details of how you can access it
Register for free
Sign up for a free account to gain:
- Unlock additional content
- Register for Capital Economics events
- Receive email updates and economist-curated newsletters
- Request a free trial of our services