Last Wednesday, the Bank of Canada, with Stephen Poloz as the new central bank governor, decided to leave the key borrowing rate where it has been since September 2010 at 1% and said that it will keep interest rates near record lows for some time to come.
This was also the first chance for Mr. Poloz to provide input to the bank’s quarterly Monetary Policy Report — a look at economic conditions and possible threats to growth forecasts, and a document that he helped launch at the BoC before leaving to later head Economic Development Canada, the Ottawa-based export credit agency.
In Wednesday’s report, the bank said Canada’s economy is “expected to be choppy in the near term.” It forecast growth of 1.8% this year, up from an estimate of 1.5% in its April report. But for the second quarter this year alone, the bank is forecasting slower growth of about 1% reflecting the impact of the flooding on Alberta and province-wide construction strike in Quebec.
To read the Bank of Canada’s new release and report, click here.
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