The Bank of Canada is keeping its key interest rate on hold in a decision that positions the country as an exception among advanced economies already responding to the weakening world economy.
Governor Stephen Poloz’s team is warning that the resilience of Canada’s economy will be increasingly tested by persistent global trade conflicts and uncertainty.
The central bank’s decision to hold the rate at 1.75 per cent today was widely expected by financial markets. The benchmark has now been at the same level for just over a year.
The bank says the global outlook has continued to deteriorate since the summer and that Canada is feeling the effects.
It says economic growth here is expected to be 1.5 per cent in 2019 before picking up its pace to 1.7 per cent next year and 1.8 per cent in 2021.
The bank notes that the domestic economy has held up well in many areas — employment has remained strong, wages have advanced in some regions and housing activity has expanded in most markets.
The Canadian Press