The Bank of Canada has held the benchmark interest rate at 1% for nearly
three years running and despite record household debt, a crumbling
eurozone and slowing growth in China, there’s still no sign that’s going
to change any time soon.
It’s not the lowest rate on record — for a stretch in 2009 and 2010 it
went down to just 25 basis points — but it’s certainly one of the
longest periods in history of the central bank that the overnight rate
has been kept close to rock bottom for so long.
Interestingly, the Governor of the Bank of Canada has been hinting for
more than a year that the next rate move will be up even as the outlook
for economic growth has grown increasingly gloomy — leading some
observers to predict that in fact a downward shift is more likely.
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