Source : Flickr/Dennis Jarvis
Canada’s economy is set to experience sustainable growth in the coming months according to latest data. As a result, it was highly surprising when the country decided to leave its monetary policy unchanged on Wednesday. While talking about the unchanged monetary policy, Governor Stephen Poloz said that it’s too early to come a conclusive decision to cut down the interest rates.
This isn’t surprising given that he told during a press conference earlier in January that the policymakers were discussing possible cut rate but the bank was decidedly neutral. At the time, he said, “Given the data that we’ve seen in the last few months, I can quite clearly say no, a rate cut was not on the table at this time.”
Poloz said that as housing market in Toronto is growing stronger than ever and as a result, the central bank is not going to touch the interest rate anytime soon. Moreover, at the time, Senior Deputy Governor Carolyn Wilkins said that although the bank sets policy independently, higher U.S. rates will have impact on the policies. At the time, he said, “As the Federal Reserve starts to tighten interest rates, we’re going to quite naturally import some of that rise and in fact we have seen that.”