The Globe and Mail reports in its Thursday, July 11, edition that the Bank of Canada kept its key interest rate unchanged Wednesday and avoided signalling its plans.
The Globe's Bill Curry writes that the BOC avoided signalling its plans, even as its United States counterpart set the stage for a rate cut as soon as this month. Carolyn Wilkins, the BOC's senior deputy governor, said Canada and the U.S. are taking different approaches because they are in different stages of the economic cycle.
She said after latest interest rate decision: "The fact that Canada is picking up while the U.S. economy is slowing sounds like a divergence. In fact, it's a process of convergence. The U.S. is slowing to a more sustainable pace, while Canada is moving back up to its trend growth."
The overnight rate remains at 1.75 per cent, where it has stayed since the bank announced an interest rate increase in October, 2018.
The decision was in line with economists' expectations.
The bank's report included a slight increase in Canada's economic growth forecast for 2019 -- 1.3 per cent, up from the 1.2 per cent it forecast in its April report -- while projecting somewhat slower growth next year.
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