UPDATE: Bank of Canada Holds Key Rate at 5%

In its most recent announcement, the Bank of Canada has maintained its key interest rate at 5%, a move that reflects its commitment to balancing economic growth and inflation control. This also marks the fourth consecutive time the BoC has decided to hold the rate.

The bank has been clear on their reasons for not already cutting the rate. “The Council is still concerned about risks to the outlook for inflation, particularly the persistence in underlying inflation,”

While we were all hoping for a cut in the key rate, there is still a silver lining to today’s announcement. Discussions of rate shifts have gone from hikes to talks of cuts. This doesn’t only signal a rate cut in the near future but also shows the general outlook and attitude of the BoC.

Here’s an encouraging statement by Tiff Macklem: “With overall demand in the economy no longer running ahead of supply, governing council’s discussion of monetary policy is shifting from whether our policy rate is restrictive enough to restore price stability to how long to stay at the current level,”

Only time will tell what comes next but I think it’s safe to say that there looks to be light at the end of the 2024 tunnel.

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