December 7, 2017 2:51 pm

BUSINESS REPORT: What’s next for interest rates in Canada?

Stephen Poloz, Governor of the Bank of Canada holds a news conference concerning the rise of the bank's interest rates, in Ottawa, Tuesday July 12, 2017.

The Canadian Press/Fred Chartrand
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In Wednesday’s policy announcement, Bank of Canada governor Stephen Poloz said that Canadian interest rates would be going up “over time.” Noted Toronto economist David Rosenberg adding that in his view, “it will be a long time.”

He said global uncertainty, moderating U.S. economic growth and trade concerns – meaning NAFTA – and even robust employment numbers aren’t enough to move the bank from their current stance.

READ MORE: BUSINESS REPORT: Bank of Canada leaves rates untouched

Rosenberg, in Thursday morning’s Globe and Mail, called the bank’s stance “cautious,” which is a wait-and-see mode, meaning the bank will be watching trade, housing, bank regulations, fiscal policy, minimum wage hikes and the impact this has on the labour market.

Raising rates would do more to compound the uncertainties that Poloz is concerned about.

Therefore, Rosenberg forecasts if the U.S. goes ahead with three planned rate hikes in the interim, and they probably will, it could take the loonie down to US$0.73.

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