01/27/2022
The bank expects a strong economic rebound after lockdown measures are lifted, although it revised down its GDP growth projections for the year by half a percentage point, to 4.6 per cent.
The bank continues to place most of the blame for high inflation on rising energy prices and supply chain disruptions, which have pushed up the cost of goods dramatically. The MPR says that nearly 4 percentage points of inflation are tied to energy prices and prices for “components subject to supply constraints.”
The MPR made particular note of food price inflation, which has been driven by drought, labour shortages and higher energy costs. The bank warned that “food price inflation will be above its historical average over 2022.”
The bank ended its government bond buying program, known as quantitative easing, in November. It is now in what it calls the reinvestment phase, where it is only buying bonds to replace ones that it already owns which are maturing.
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https://financialpost.com/news/economy/bank-of-canada-interest-rate-decision-0126-22
Check here for the latest news and analysis as the Bank of Canada and the U.S. Federal Reserve announce decisions today