The Globe and Mail reports in its Tuesday edition that central bankers' plans to increase interest rates this year have been upended by the slowing global economy and falling stock markets.
The Globe's Barrie McKenna writes that barely two months ago Bank of Canada Governor Stephen Poloz and United States Federal Reserve chairman Jerome Powell were talking confidently about riding the surging global economy to a future of much higher interest rates.
Suddenly, talk has shifted to themes of patience and flexibility, rather than action, as central bankers digest the conflicting economic signals.
On Wednesday, Mr. Poloz is widely expected to keep the BOC's key rate on hold at 1.75 per cent. The BOC is also releasing its first quarterly forecast of 2019 for the Canadian economy, which is expected to be significantly more pessimistic than the one it put out in October.
The Globe says experts are already forecasting that banks will soon move to drop fixed-term mortgage rates. If the BOC holds rates steady for much of the year ahead, Canadians with variable-rate mortgages will likely be spared being hit with higher monthly costs that many had feared. Mr. McKenna believes a rate hike is off the table for now.
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