Economy · 5 d ago
Bank of Canada - Banque du Canada from Canada · CC BY 2.0 · Wikimedia Commons
The Bank of Canada is expected to raise its key rate for the first time since 2023
Expected hike
0.25 points
Markets and economists expect a quarter-point hike, from 2.25 per cent to 2.5 per cent. The rate has held at 2.25 per cent for nearly a year.
The bank has signalled it is increasingly worried about inflation from the war in the Middle East. It says it would raise the rate if price pressures spread beyond the gas pumps.
What we know
- Rate held at 2.25% for a year
- First hike since July 2023
Not yet
- Whether inflation spreads beyond energy
Some economists question the need, citing 110,000 jobs lost in two months and flat growth in July. The decision comes with updated forecasts at 9:45 a.m. ET.
And us?
A higher key rate raises borrowing costs for Canadians with variable-rate loans and lines of credit, at a time when jobs are weakening.
