ontario news watch

Bank of Canada readies call on key rate, path for federal bond purchases

OTTAWA — The Bank of Canada is scheduled to release its latest interest rate decision today along with its plans for federal bond purchases.

The key interest rate target has been on hold at 0.25 per cent since the onset of the pandemic last year and the central bank has said it won’t increase the rate until the economy has recovered likely late next year.

In April, the bank rolled back its federal bond purchasing program, citing improving economic conditions.

BMO’s Benjamin Reitzes says no policy changes are expected today.

However, he says the central bank is likely to tone down the optimism it showed in April, given the lengthy third-wave lockdowns and expectations of less-than-robust economic growth in the second quarter.

The decision today will be by written announcement only, but deputy governor Timothy Lane is scheduled to discuss the decision in a speech tomorrow.

This report by The Canadian Press was first published June 9, 2021.

The Canadian Press