This article was last updated on April 16, 2022
Canada: 
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Declining all indicators signaling a surge in inflation as temporary, the Bank of Canada has decided to maintain its overnight rate at 1 percent as expected on Wednesday, while reiterating that it can as easily cut rates as hike them.
However, in light of inflation hitting 2.3 percent in May and higher-than-expected core inflation, the central bank did remove stern language from its June rate statement, which alleged that the downside risks to its inflation outlook were as important as before. Instead, it was stated that the risk of a downward drift in inflation expectations has diminished with inflation now close to the 2 percent target. According to its Monetary Policy Report, “the bank does not expect the recent momentum in monthly inflation to persist” and so “the bank’s judgment is that underlying inflation pressures remain muted, given the persistent slack in the economy and continued intense competition in the retail sector.”
As a consequence of the not-so-good economic growth, the bank revealed in its Monetary Policy Report to have once again pushed its expectations to mid-2016, for when the economy would reach full capacity and when core inflation would rise to the 2 percent target. Furthermore, the bank speculated that total inflation would dip back below 2 percent in the second quarter of 2015 and rise to the target only in the first quarter of 2016. It was mentioned that “the bank is neutral with respect to the timing and direction of the next change to the policy rate.”
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