The Bank of Canada raised interest rates by 50 basis points as expected, bringing them to 4.25%, the highest level since the beginning of 2008.
However, the lack of the usual reference, in the post-meeting communiqué, to the need to further increase the cost of borrowing suggests the possibility of a pause for the first time since the beginning of the monetary tightening cycle.
“The Governing Council will consider whether the policy rate needs to increase further to bring supply and demand back into balance and bring inflation back to target,” the bank said in a statement.
The institute reaffirmed its commitment to bringing inflation under control, keeping the growth in consumer prices below 2% per year. On the other hand, however, he signaled that the more restrictive monetary policy is “holding back internal demand”, emphasizing the moderation of consumption in the third quarter and the slowdown in the real estate market.