MARCH 1st, 2011 -BANK OF CANADA- NO CHANGE FOR THE OVERNIGHT RATE(ZT)

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OTTAWA - The Bank of Canada today announced that it is maintaining its target for the overnight rate at 1 per cent. The Bank Rate is correspondingly 1 1/4 per cent and the deposit rate is 3/4 per cent.

The global economic recovery is proceeding broadly in line with the Bank's projection in its
% d4 O& p/ f, T9 _$ ~+ pJanuary Monetary Policy Report (MPR), although risks remain elevated. U.S. activity is
8 R$ h; ^8 V# isolidifying and remains supported by stimulative fiscal and monetary policies. Ongoing
7 B) y+ R4 B8 _, ^$ x7 Q* vchallenges associated with sovereign and bank balance sheets will limit the pace of the European
recovery and are a significant source of uncertainty to the global outlook. Robust demand from
emerging-market economies is driving the underlying strength in commodity prices, which could
be further reinforced temporarily by supply shocks arising from recent geopolitical events.
1 X; k7 R9 v( d2 d" b7 P
The recovery in Canada is proceeding slightly faster than expected, and there is more evidence of
% F* V0 q2 W+ i2 U0 Zthe anticipated rebalancing of demand. While consumption growth remains strong, there are
signs that household spending is moving more in line with the growth in household incomes.
& K$ M# \- K% {2 L. F6 h7 ZBusiness investment continues to expand rapidly as companies take advantage of stimulative
3 D6 h8 x. D, u# Y6 ~financial conditions and respond to competitive imperatives. There is early evidence of a
recovery in net exports, supported by stronger U.S. activity and global demand for commodities.
7 k) _; x: ~$ {& ]3 gHowever, the export sector continues to face considerable challenges from the cumulative effects
  N* B, @9 P, @; h4 j- ~% vof the persistent strength in the Canadian dollar and Canada's poor relative productivity
performance.
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While global inflationary pressures are rising, inflation in Canada has been consistent with the
1 t' T$ ~  O0 U9 gBank's expectations. Underlying pressures affecting prices remain subdued, reflecting the
# M9 ?& O8 P. o" j/ s5 vconsiderable slack in the economy.

' m5 [' n* P0 G  O) UReflecting all of these factors, the Bank has decided to maintain the target for the overnight rate
at 1 per cent. This leaves considerable monetary stimulus in place, consistent with achieving the
% B) l3 s" Z% \/ e" N2 per cent inflation target in an environment of significant excess supply in Canada. Any further
+ K3 ?/ v) g& Q% `" a- r1 ^( R; [2 wreduction in monetary policy stimulus would need to be carefully considered.
Information note:

The next scheduled date for announcing the overnight rate target is 12 April 2011.

小黄

It won't be changed for a long time.

web123

but banks will raise mortgage rate, for sure.