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

LETTER: Blanket firearms ban misses the point

A letter to the editor from MP Cathy McLeod

Organic food and beverage products sold in B.C. must be certified

VICTORIA - As of Saturday, Sept. 1, 2018, people can buy British… Continue reading

Donna Kibble is running for council in Barriere

‘I love Barriere, I’m dedicated and I will do a good job.’

Making pictures with professional photographer John Enman

Black-and-white photography: film vs. digital

Environment Canada confirms Ottawa area hit by two tornadoes Friday

At one point more than 200,000 hydro customers were blacked out

Whitecaps see playoff dreams fade after 2-1 loss to FC Dallas

Goal in 87th minute seals Vancouver’s fate

B.C. students send books to displaced students of Hornby Island school fire

Maple Ridge elementary school teacher says students learned about acts of kindness

Trump drains oxygen from Trudeau foreign policy with PM, Freeland bound for UN

A lot has changed since the Liberals came to power in Canada in 2015

B.C. man fined $15,000, barred from trading securities for fraud

Larry Keith Davis used money from an investor to pay personal bills

Emergency crews investigate small sulphuric acid spill in Kootenays

IRM states a small volume of less than one cup and three dime-sized drips were leaked from carrier

Family, friends of B.C murder victim want killer sent back to max security facility

Group wants convicted murderer Walter Ramsay sent back to a maximum security facility

Most Read