The Bank of Canada is seen in Ottawa on May 30, 2018. THE CANADIAN PRESS/Sean Kilpatrick

Canada could raise interest rates this week

Canada faces a number of trade-related uncertainties, including NAFTA talks, U.S. tariffs and the threat of more duties

After waiting for half a year, Stephen Poloz appears ready to get back on his rate-hiking path this week.

Recent signals from the Bank of Canada governor, combined with strong economic data, have experts widely predicting Poloz will raise his trend-setting rate Wednesday from its current level of 1.25 per cent.

Citing a cautious, data-dependent approach, Poloz hasn’t touched the rate since he increased it in January, a move that followed increases last year in September and July.

Another rate increase this week would come with Canada facing a number of trade-related uncertainties, including NAFTA talks, U.S. steel and aluminum tariffs and the threat of more duties on the economically critical automotive sector.

But TD chief economist Beata Caranci says she expects Poloz to work with the data he has in front of him and many analysts point to healthy numbers of late — including the Bank of Canada’s own survey on business sentiment, jobs numbers and growth in wages.

Caranci says if the trade dispute deteriorates further she believes hiking the interest rate now would give Poloz more flexibility to possibly lower it down the road, if necessary.

While expectations are high that Poloz will raise the rate this week, some experts predict the ongoing trade uncertainty will be enough to keep Poloz on hold for a little longer.

The National Bank of Canada wrote in a recent note that trade developments since the central bank’s last meeting, including stalled NAFTA talks and a possible trade war between the U.S. and China, will be enough to give Poloz pause.

In making the call, the National Bank acknowledged that it’s an outlier in a market that widely sees the right conditions for another increase.

The Canadian Press

Like us on Facebook and follow us on Twitter.

Just Posted

Salmon Arm athletes hit the track in Cowichan 2018 BC Games

Results from day one with Thompson-Okanagan team are in

Taxi collides with parked dump truck in Salmon Arm

No word yet on the cause or if charges will be laid

Okanagan Wildfires: An evening update on wildfires and evacuations

A Saturday evening look at the major wildfires impacting the Okanagan and Similkameen.

Racers wanted for Shuswap soap box derby

Salmon Arm 10-year-old Brody Paton is making preparations for annual Friendship Day event

Melodic summer evenings live on in the Shuswap

WOW has grown from a small gathering to a weekly festival that attracts from 500 to 1,000 people

BC Games: Day 2 comes to an end

Hundreds of medals have been handed out at the 2018 BC Summer Games in the Cowichan Valley

Lettter: Columnist wrong about Mexico, England

America hater, Gwynne Dyer, misrepresents and obfuscates the facts in his last… Continue reading

Letter: Roads in Shuswap’s Blind Bay being neglected

Two weeks ago we went for a drive to Notch Hill Estates.… Continue reading

Letter: Unconvinced of benefits of proportional representation

BC citizens have a very important decision coming up this fall; to… Continue reading

Update: Mount Eneas wildfire holds at 1,374 hectares

Fire chief Dennis Craig said wind was blowing the fire away from homes

Invasive species can be a matter of perspective

Column: Great Outdoors/James Murray

Update: Okanagan Mountain Park fire holds at 400 hectares

The wildfire, also called Goode’s Creek wildfire, continues to burn near Kelowna

Car thief nabbed by Mounties on wildfire duty

RCMP working wildfires deploy spike belt to nab alleged auto thief from Oliver.

Most Read