Holds steady on economic outlook despite weak third quarter
In the face of a weaker than anticipated third quarter, the Bank of Canada did what onlookers expected it to do Tuesday, maintaining its key interest rate at 0.25 per cent and holding steady on economic recovery predictions. In a statement, the central bank pledged to keep rates near zero until the end of June 2010, and repeated its concern about the impact of a strong Canadian dollar, which it said could “act as a significant further drag on growth and put additional downward pressure on inflation.” Economic expansion, the bank says, will continue to grow across the private sector. Inflation is expected to return to two per cent by the second half of 2011.