The Globe and Mail reports in its Saturday edition that Canada's overall inflation rate in February edged up to 1.5 per cent but was below the Bank of Canada's target for the second month. A Reuters dispatch to The Globe reports that the market expects the BOC will stand pat on rates.
Although the inflation rate ticked up from the 1.4 per cent seen in January, it was still less than the BOC's 2-per-cent target. The bank's closely watched three measures of core inflation were also under 2 per cent. RBC economist Nathan Janzen says: "There's really no inflation pressure pushing the BOC to move on rates quickly. For them, it's another reason to sit on the sidelines for now."
The BOC held interest rates steady as expected on March 6 and took a slightly more dovish tone, saying there was "increased uncertainty" about the timing of future rate increases.
BMO economist Doug Porter says: "It's pretty tough to see the BOC doing anything for quite a while. Core inflation is stuck below 2 per cent, there are lots of warning signs on global growth, not to mention Canadian growth."
The bank's next interest rate announcement is scheduled for April 24 and most market operators are expecting it to announce no change.
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