The Bank of Canada maintained its benchmark interest rate at 1 per cent on Tuesday October 19 after three consecutive increases.
The prime rate will remain at 3 per cent, which means there is no effect on mortgage holders for the short term.
In general, the economic forecast is gloomier than previously predicted. Canada is being pulled down by a U.S. recovery that will be weaker than expected, a global turnaround that is “entering a new phase” fraught with uncertainty, and a retrenchment by Canadian consumers, the central bank said in a statement on the decision.
The expected growth for 2010 has been cut to 3 per cent from 3.5 per cent, while 2011 growth was cut to 2.3 per cent from 2.9 per cent, and 2012 growth raised to 2.6 per cent from 2.2 per cent.