The Bank of Canada announced that it would maintain the current benchmark interest rate and said it was too early to consider cutting interest rates.

　　China News Service, Toronto, March 6 (Reporter Yu Ruidong) The Bank of Canada announced on the 6th that it will maintain the benchmark interest rate, the overnight lending rate, at 5% and continue to implement quantitative tightening policies.

The move was in line with widespread market expectations.

　　Bank of Canada Governor Steve Macklem said at a press conference in Ottawa that the central bank believes that the current policy interest rate is still appropriate and that it is too early to consider cutting interest rates.

Recent inflation data suggests that the Bank of Canada's monetary policy is broadly in line with expectations.

However, he pointed out that the risk of upward inflation still exists.

The Bank of Canada needs to see core inflation ease further.

　　The Bank of Canada believes that in terms of the global economic environment, growth slowed down in the fourth quarter of last year and inflationary pressures continued to ease.

In Canada, the economy grew more than expected in the final quarter of last year, but growth remained weak and below its potential.

The data points to a modest oversupply in the country's economy.

　　Canada's consumer price index (CPI) rose 2.9% year-on-year in January this year, the lowest increase since June 2023.

However, the Bank of Canada pointed out that housing price inflation continues to be high and remains the main driver of overall inflation.

Underlying inflationary pressures remain.

　　Macklem said the central bank expects the country's inflation rate to be close to 3% by the middle of this year and to slow in the second half of the year.

The return to the 2% target inflation level will be slow and potentially uneven.

　　After the emergence of the new crown epidemic, the Bank of Canada has successively cut interest rates since March 2020, with the benchmark interest rate falling from 1.75% to 0.25%.

Starting from March 2022, in order to curb inflation, the Bank of Canada has raised interest rates 10 times, raising the benchmark interest rate to 5% in mid-July 2023, reaching the highest level since April 2001.

The next Bank of Canada interest rate meeting is April 10.

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