Bank of Canada May Not Hike Interest Rates Until 2016: Scotiabank
How long for the Bank of Canada?
Bank of Nova Scotia economists are now raising the possibility of no move in the Bank of Canada’s benchmark interest rate until 2016.
Other observers have speculated on late next year or early in 2015 for the first rate hike by the central bank.
The Bank of Canada’s benchmark overnight rate now stands at just 1 per cent.
“The BoC probably now envisages spare capacity remaining into 2016,” the Scotiabank economists said, adding the central bank now projects hitting its 2-per-cent target for annual inflation in mid-2015.
They believe the Bank of Canada may change that forecast, to an even later date, when [it] meets later this month and also issues its monetary policy report.