We were cleaning out old posts from our forum and migrating some to the blog. I came across this one from May 2006. 3.5 years later and look at the difference! Here’s the 2006 post….
The Bank of Canada increased its overnight lending rate up a quarter of a percent to 4.25, bringing it near a five-year high, and signalled it will take a breather in its rate-hike cycle. Evidently things are going up in Canada, including inflation, to warrant the hike.
The central bank has boosted the rate seven times in a row to cool an economy that’s operating at full steam, and to keep a lid on an expected pick-up in inflation.
It suggested that it was now comfortable with the level of interest rates and that it will await more economic reports before making another move. The central bank has suggested that interest rates have now reached a more neutral level, where they neither stimulate nor hamper economic growth.I say let them go up, blow apart the housing market that’s already beyond recognition in Alberta
In its previous statement, the bank said some modest further increases in the rate may be required, they have now dropped that statement entirely.
The bank said strong momentum in the global and Canadian economies has continued, though it noted the recent volatility in financial markets. It said recent Canadian reports confirm that domestic demand remains solid. Inflation is evolving largely in line with its expectations.