Is an interest rate hike closer than we think?
Bank of Canada Governor Stephen Poloz said Wednesday that interest rate cuts effected in 2015 to counter the negative impact in the drop in oil prices have worked.
“It does look as though those cuts have done their job,” he said.
“But we’re just approaching a new interest rate decision so I don’t want to prejudge.”
With this statement, the odds have once again shifted, now to an over 50 per cent chance of a rate hike in July.
That’s up from 30 per cent on Tuesday.
Poloz again reiterated that every major region is gathering momentum, and although everyone is in a different phase of the business cycle, the synchronized growth across the country is a positive.
If the central bank doesn’t opt for a rate hike next month, it may yet make a move this fall.
With unexpectedly strong GDP growth in the first quarter, a continuation of that momentum when second quarter GDP is reported August 31 could seal the deal.
Adding fuel to the fire, the Bank of Montreal is now adding its voice to calls for a rate hike at the Bank of Canada’s July 12 policy meeting.
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