The Bank of Canada announced on Wednesday that it will raise interest rates by 0.5 percentage points to 1%, the lowest level in 22 years, in a bid to reduce high inflation.
The last time the central bank announced a half-point interest rate hike was in May 2000. Normally the country would increase by 0.25 points.
The company justified the rise in inflation to 5.7% in Canada, especially due to rising energy and food prices.
Canadian officials predict that average inflation will be 6% in the first half of 2022, and that it will be “much higher” than the Bank of Canada’s target for the rest of the year, ranging from 1% to 3%.
According to the same forecast, inflation will fall to 2.5% in the second half of 2023 and 2% in 2024.
The central bank also said in a statement that it would stop converting government securities at maturity from the massive program launched during the Govt-19 epidemic.
The company noted that the Canadian economy is growing strongly and is moving towards a level of overcrowding. Forecasts are that the economy will grow by 4.25% this year, 3.25% in 2023 and 2.25% in 2024.
In March, Canada’s unemployment rate fell to 5.3%, its lowest level since 1976.
“Devoted music specialist. Student. Zombie trailblazer. Internetaholic. Food geek.”
More Stories
Acrylic or Gel? Key Differences to Help You Decide
Creating the Ideal Environment for Your Pet Tortoise
In Search of Adrenaline: What Kinds of Extreme Tourism to Try