Investing.com - The Bank of Canada kept its benchmark interest rate on hold in October, after already cutting rates twice this year, it announced on Wednesday.
The BoC said it was leaving its overnight cash rate unchanged at 0.50%, in line with expectations.
Inflation has evolved in line with the outlook in the Bank’s July Monetary Policy Report. Total CPI inflation remains near the bottom of the Bank’s target range, owing to declines in consumer energy prices.
Core inflation is close to 2.0% as the transitory effects of the past depreciation of the Canadian dollar are roughly offsetting disinflationary pressures from economic slack, which has increased this year.
Canada’s economy has rebounded, as projected in July. The Bank projects real GDP will grow by just over 1.0% in 2015 before firming to about 2.0% in 2016 and 2.5% in 2017.
The BoC judges that the risks around the inflation profile are roughly balanced. Meanwhile, as financial vulnerabilities in the household sector continue to edge higher, risks to financial stability are evolving as expected.
Taking all of these developments into consideration, the Bank judges that the current stance of monetary policy remains appropriate.
BoC Governor Stephen Poloz was to comment on the decision at a press conference later in the day.
USD/CAD was trading at 1.3070 from around 1.3043 ahead of the announcement.