The National Post reports in its Monday, Oct. 24, edition that Canada's top economists are expecting the Bank of Canada to deliver another outsized rate hike on Wednesday in its continued fight against decades-high inflation.
The Post's Stephanie Hughes writes that the central bank is expected to raise the policy rate by 50 or 75 basis points as part of its strategy of front-loading rate hikes, but comes at a time when recession calls are growing louder. Some economists are expecting the BOC to take its foot off the gas following this rate decision.
The BOC has already increased the policy rate by three percentage points over the course of the year, bringing the overnight rate to 3.25 per cent. The analysts at Desjardins expects BOC Governor Tiff Macklem's tough talk on inflation would push him to hike rates by another 75 basis points, bringing it to 4 per cent. Desjardins's Royce Mendes says, "Governor Macklem knows he can't continue like this forever, adding that a hike this size is consistent with the BOC's front-loading rate hike strategy." He expects that an accompanying statement from the BOC will "at least implicitly concede that future adjustments won't be as large."
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