Published on 03/22/2023 at 14:55
(Photo: The Canadian Press)
Ottawa – The Bank of Canada remains concerned that inflation will be harder than expected to be brought down, noting that the economy is still in excess demand.
The central bank on Wednesday published a summary of its Governing Council’s deliberations ahead of its decision to keep interest rates on hold at 4.5% on March 8th.
Governing Council members, including the governor and his deputies, were encouraged to see the economy and inflation slowing, which supported their decision to keep interest rates on hold.
However, the board remained concerned about the risk that inflation would remain well above its 2% target and agreed that demand in the economy was still outstripping supply.
The Bank of Canada also forecasts that growth in early 2023 could be stronger than previously forecast.
In the run-up to the preparation of the budget by the federal and state governments, the leadership council also discussed the risk of high government spending further boosting demand in the economy.
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