In its scheduled May 31st interest rate announcement, the Bank of Canada indicated that the bank rate would be maintained at the current level of 1.25%.
In the accompanying press release, which can be found on the Bank’s Web site at http://www.bankofcanada.ca/2011/05/press-releases/fad-press-release-2011-05-31/, the Bank indicated that in Canada, the economic expansion is proceeding largely as expected. However, while “underlying” inflation is relatively “subdued”, it expects that high energy prices and changes in provincial indirect taxes will combine to keep the overall inflation rate above 3% for the near future. Balancing all factors, the Bank concluded that no change in the current interest rate environment was warranted.
The Bank’s next scheduled interest rate announcement will take place on July 19, 2011.