The Bank of Canada is widely expected to raise interest rates by 75 basis points today
(September 7) in an effort to dampen inflation that is running at a 30-year high.
More than 30 economists surveyed by Bloomberg Markets said they expect Canada’s central
bank to raise its trendsetting overnight interest rate by at least 50 basis points, with most saying
they anticipate a 75 basis point rate increase.
Canada’s inflation rate currently stands at 7.6%, nearly four times the central bank’s 2% target.
If correct, a 75 basis point rate hike would bring the Bank of Canada’s benchmark interest rate
to 3.25%, the highest level among developed countries.
The central bank has so far this year raised its key lending rate to 2.50% from 0.25%. The Bank
of Canada started with a quarter-point rate hike and accelerated its pace of tightening to a full
percentage point rate hike in July of this year.
Markets will be looking for clues on whether the Bank of Canada intends to continue raising
interest rates through the remainder of this year.
The latest interest rate decision will be announced in a written statement at 10 a.m. today in
Ottawa. There will not be a press conference following the interest rate decision.
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