The Globe and Mail reports in its Friday edition that Bank of Canada Governor Stephen Poloz is doubling down on his commitment to let the latest economic data determine how and when to restore higher interest rates.
The Globe's Barrie McKenna writes that Mr. Poloz said Thursday that the BOC, which has kept its key rate on hold since October, is struggling to make sense of two sources of often conflicting uncertainty buffeting the economy -- the cooling housing market and sluggish business investment.
Mr. Poloz said: "The path back to that neutral range is highly uncertain. We're data dependent. So it depends how the economy delivers." Mr. Poloz insisted the bank remains committed to getting its benchmark rate, now at 1.75 per cent, back to the neutral range of 2.5 per cent to 3.5 per cent.
The neutral rate is the level at which it neither heats up the economy, nor slows it down.
Mr. Poloz's tone suggests further rate hikes are not likely until late this year. The bank has raised its key rate five times since mid-2017.
BMO economist Sal Guatieri says, "The [BOC] is still leaning toward lifting rates, but not by much not any time soon."
Mr. Poloz was mum on the pace and timing of getting back to neutral.
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