Friday, February 23, 2024
HomeBusinessBank of Canada remains on hold

Bank of Canada remains on hold


MONTREAL, Canada – The Bank of Canada ended the year without raising rates, signaling a tone of confidence that our economy is not overheating anymore. Inflation cooled to 3.1 percent in October from 3.8 percent in September. Lower oil prices helped bring inflation closer to target. While goods inflation fell to 1.7 percent, services inflation was at 4.6 percent in October 2023 (an increase from 3.9% in September).

Inflation should continue to trend lower in the new year, clearing part of the uncertainty. Canada’s policy rate is most likely going to stay at 5 percent as the Bank of Canada waits to see further easing in core inflation measures. Before thinking of bringing the policy rate down the central bank will need to feel confident that inflation is on track to reach the 2 percent target and stay there.

The loonie stabilizes in November

The Canadian dollar was stable in November, averaging the same level as in October at US$0.73. While the currency has gained some strength towards the end of November, the long-term outlook remains muted.

In 2024, the greenback will remain strong as the US economy outperforms its major trading partners. Therefore, the Canadian dollar is expected to remain weak, fluctuating between US$0.72 and US$0.75.

Enlarge the table

Pessimism intensifies among business leaders

The CFIB’s confidence index for the year ahead continued to fall below the critical 50 mark, from 47.2 to 45.6 between October and November. Optimism continued to decline in nearly every province. Among the provinces, confidence was lowest in Ontario and Quebec, at 45.2 and 42, respectively.

Key indicators—Canada

A slowing economy combined with tight credit conditions has weighed heavily on business confidence.

Enlarge the tableEnlarge the table



Please enter your comment!
Please enter your name here


Caribbean News

Global News

‘We are not where we might have hoped to be at this point’ UK-WTO

Delivered by the UK on 14 February 2024 at the World Trade Organization General Council. ENGLAND /SWITZERLAND - Clearly we are not where we...