Canada Interest Rate

The benchmark interest rate in Canada was last recorded at 1 percent. Interest Rate in Canada is reported by the Bank of Canada. Interest Rate in Canada averaged 6.02 Percent from 1990 until 2014, reaching an all time high of 16 Percent in February of 1991 and a record low of 0.25 Percent in April of 2009. In Canada, interest rate decisions are taken by the Bank of Canada's (BoC) Governing Council. The official interest rate is the Bank Rate. Since 1996 the Bank Rate is set at the upper limit of an operating band for the money market overnight rate. Previously, from March 1980 until February 1996 the Bank Rate was set at 25 basis points above the weekly average tender rate for 3-month Treasury bills. This page provides - Canada Interest Rate - actual values, historical data, forecast, chart, statistics, economic calendar and news. 2014-04-17

Actual Previous Highest Lowest Forecast Dates Unit Frequency
1.00 1.00 16.00 0.25 1.00 | 2014/05 1990 - 2014 Percent Monthly

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Canada Interest Rate
LIST BY COUNTRY


CALENDAR GMT Country Event Reference Actual Previous Consensus Forecast
2013-12-04 03:00 PM Canada
BoC Interest Rate Decision
1% 1% 1% 1%
2014-01-22 03:00 PM Canada
BoC Interest Rate Decision
1% 1% 1% 1%
2014-01-22 04:15 PM Canada
BoC Press Conference
2014-03-05 03:00 PM Canada
BoC Interest Rate Decision
1% 1% 1% 1%
2014-04-16 03:00 PM Canada
BoC Interest Rate Decision
1% 1% 1% 1%
2014-06-04 03:00 PM Canada
BoC Interest Rate Decision
1% 1%
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Money Last Previous Highest Lowest Forecast Unit
Central Bank Balance Sheet 88028.00 2014-03-31 88584.00 90164.00 2226.00 91133.94 2014-04-30 CAD Million [+]
Foreign Exchange Reserves 76450.00 2014-03-31 77169.00 77169.00 1678.10 76822.53 2014-04-30 USD Million [+]
Foreign Stock Investment 6080.00 2014-02-28 1220.00 26142.00 -24132.00 4847.70 2014-03-31 CAD Million [+]
Interbank Rate 1.00 2014-03-31 0.99 21.57 0.24 1.00 2014-04-30 Percent [+]
Loans to Private Sector 218828.00 2014-02-28 219109.00 220896.00 10151.00 219301.10 2014-03-31 CAD Million [+]
Money Supply M0 71139.00 2014-02-28 70790.00 71139.00 2214.00 71367.07 2014-03-31 CAD Million [+]
Money Supply M1 735990.00 2014-02-28 735642.00 735990.00 30706.00 743583.35 2014-03-31 CAD Million [+]
Money Supply M2 1249498.00 2014-02-28 1248366.00 1249498.00 25523.00 1253632.98 2014-03-31 CAD Million [+]
Money Supply M3 1788525.00 2014-02-28 1800319.00 1800319.00 37982.00 1805661.36 2014-03-31 CAD Million [+]
Interest Rate 1.00 2014-04-16 1.00 16.00 0.25 1.00 2014-05-31 Percent [+]
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Bank of Canada Leaves Rates at 1%

At its April 16th, 2014 meeting, Bank of Canada decided to leave the overnight lending at 1 percent, as the Bank continues to see a gradual strengthening in the fundamental drivers of growth and inflation.

Excerpt from the statement by the Bank of Canada:

Inflation in Canada remains low. Core inflation is expected to stay well below 2 per cent this year due to the effects of economic slack and heightened retail competition, and these effects will persist until early 2016. However, higher consumer energy prices and the lower Canadian dollar will exert temporary upward pressure on total CPI inflation, pushing it closer to the 2 per cent target in the coming quarters. We expect total CPI inflation will remain close to target throughout the projection, even as upward pressure from energy prices dissipates, because the impact of retail competition will gradually fade and excess capacity will be absorbed.

The Bank continues to expect Canada’s real GDP growth to average about 2 1/2 per cent in 2014 and 2015 before easing to around the 2 per cent growth rate of the economy’s potential in 2016. Competitiveness challenges continue to weigh on Canadian exporters’ ability to benefit from stronger growth abroad. However, a range of export subsectors have been growing in line with fundamentals, which suggests that as the U.S. recovery gathers momentum and becomes more broadly-based, many of our exports will benefit. The lower Canadian dollar should provide additional support. We continue to believe that rising global demand for Canadian goods and services, combined with the assumed high level of oil prices, will stimulate business investment in Canada and shift the economy to a more sustainable growth track.

Recent developments are in line with the Bank’s expectation of a soft landing in the housing market and stabilizing debt-to-income ratios for households. Still, household imbalances remain elevated and would pose a significant risk should economic conditions deteriorate.

In sum, the Bank continues to see a gradual strengthening in the fundamental drivers of growth and inflation in Canada. This view hinges critically on the projected upturn in exports and investment. With underlying inflation expected to remain below target for some time, the downside risks to inflation remain important. At the same time, the risks associated with household imbalances remain elevated. The Bank judges that the balance of these risks remains within the zone for which the current stance of monetary policy is appropriate and therefore has decided to maintain the target for the overnight rate at 1 per cent. The timing and direction of the next change to the policy rate will depend on how new information influences the balance of risks.

Bank of Canada | Joana Taborda | joana.taborda@tradingeconomics.com
4/16/2014 3:11:01 PM

RECENT RELEASES

Canada Leaves Monetary Policy Unchanged
At its March 5th, 2014 meeting, Canada's central bank decided to leave the overnight rate unchanged at 1 percent, as widely expected, citing balanced risks to inflation, housing market and household debt. Published on 2014-03-05

Canada Leaves Rates on Hold in January
The Bank of Canada announced on January 22nd that it is maintaining its target for the overnight rate at 1 percent, as inflation is expected to remain below target for some time. Published on 2014-01-22


Interest Rate | Notes
The interest rate shown on this page refers to the central bank benchmark interest rate. Usually, the central bank benchmark interest rate is the overnight rate at which central banks make loans to the commercial banks under their jurisdiction. Moving the benchmark interest rate, the central bank is able to make an impact on interest rates of commercial banks, inflation level of the country and national currency exchange rate. Reduction of interest rates should bring increase in business activity, a rise in inflation rate and weakening of national currency. In case of increase in interest rates the level of business activity is likely to drop, inflation declines and national currency strengthens.


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