Bank of Canada's record interest rate: how it will affect people's lives
The Bank of Canada has already raised the interest rate seven times during 2022. This time it was the highest in 14 years.
On December 7, 2022, there was another interest rate increase in the fight against inflation. At the moment, it stands at 4.25%. The policy of toughening will continue.
Global economic growth is slowing down. In October, Canada's inflation rate is still high at 6.9 per cent. Recall that in June 2022, inflation reached 8.1%, but even at today's rate, it is still 2% higher, or 3.5 times higher.
Although the unemployment rate fell from 5.2% to 5.1% in November 2022 and average hourly earnings for October were up 5.6% from a year earlier, Canada's job market remains complicated.
The country is experiencing a rise in the price of gasoline, leading to higher prices for sought-after goods and services. The increase affects the rates that Canadian consumers and businesses receive from their banks on savings accounts and mortgages.
The Governing Council will consider whether to further raise the policy interest rate to bring supply and demand into equilibrium and return inflation to the target level.
On January 25, 2023, the Bank of Canada will announce a new interest rate and release its next full economic and inflation forecast.
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