Bank of Canada keeps policy rate unchanged at 1.75% as expected

Eren Sengezer FXStreet

As widely expected, the Bank of Canada decided to maintain its target for the overnight rate at 1.75% at its May policy meeting. Below are some key takeaways from the BoC's policy statement.

Recent Canadian economic data are in line with the projections in the Bank’s April Monetary Policy Report (MPR).
The oil sector is beginning to recover as production increases and prices remain above recent lows.
Continued strong job growth suggests that businesses see the weakness in the past two quarters as temporary.
The recent escalation of trade conflicts is heightening uncertainty about economic prospects.
Removal of steel and aluminum tariffs and increasing prospects for the ratification of CUSMA will have positive implications for Canadian exports and investment.
Recent data have reinforced Governing Council’s view that the slowdown in late 2018 and early 2019 was temporary.
In taking future policy decisions, Governing Council will remain data dependent and especially attentive to developments in household spending, oil markets and the global trade environment.

Author

Eren Sengezer

FXStreet

As an economist at heart, Eren Sengezer specializes in the assessment of the short-term and long-term impacts of macroeconomic data, central bank policies and political developments on financial assets.

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