Bank of Canada expected to remain on hold as oil shock reverberates
The Bank of Canada is expected to keep interest rates unchanged on Wednesday as it monitors the impact of the oil price shock on inflation. The central bank's governing council is cautious about raising rates too early and risking lower growth, or being late and allowing inflation to become entrenched.
The Bank of Canada is expected to leave interest rates unchanged on Wednesday as it continues to assess the impact of the oil price shock on inflation. The conflict in the Middle East has pushed global oil prices higher, causing a 21% jump in Canadian gasoline prices in March, the largest one-month increase on record. The central bank's governing council is eyeing energy prices warily, but is not expected to make any sudden moves. Governor Tiff Macklem has stated that the bank doesn't want to raise interest rates too early and risk lowering growth, particularly when it's already weak. The bank's preferred core inflation measures remained largely unchanged at just above the 2% target. The U.S. Federal Reserve also has a rate decision on Wednesday, where it is widely expected to leave its benchmark rate unchanged.
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