The Bank of Canada leaves its key interest rate at

The Bank of Canada leaves its key interest rate at 5%

The Bank of Canada again opted for the status quo on Wednesday, deciding to keep its key interest rate at 5% for the fifth straight day in hopes of combating inflation.

The last interest rate increase took place last July.

The Bank of Canada (BoC) says global economic expansion “slowed in the fourth quarter.”

In Canada, the economy performed “better than expected, but its pace remained weak and below potential,” it said.

“Housing cost growth remains high and is the largest contributor to inflation,” stressed the Bank of Canada, which continues to expect inflation to remain at around 3% in the first half of 2024 and then gradually decline.

Although it decided to keep its key interest rate at 5%, the Bank of Canada said it was “concerned about the risks associated with the inflation outlook.”

“The overall message from the bank is that it will continue to wait and see. She wants clear data showing that inflation has been eradicated,” commented Philippe Simard, Quebec mortgage director at, believing Canadians should expect interest rates to remain high.

“Anyone who has a variable rate or mortgage line of credit will likely be disappointed that there is no indication of the date of the first rate cut,” he said, judging that short-term fixed mortgage rates “will remain pending possible ones.” Key interest rate cuts popular.”

For his part, Randall Bartlett, senior director of Canadian economics at Desjardins, believes that “by recognizing the progress made,” the Bank of Canada is “setting the stage for future rate cuts.”

The expert also assumes that a first reduction will be announced in June.

Recall that since July 12, 2023, the Bank of Canada has decided to keep its key interest rate at 5% after two consecutive quarter-point increases. The next update will be on April 10, 2024.