Bank of Canada raises benchmark interest rate again

Bank of Canada leapfrogs Fed, other central banks on rate hikes

Bank of Canada leapfrogs Fed, other central banks on rate hikes

Those with the earlier-than-later foresight were right, as the main bank edged rates up 25 basis points for the second time in 2017, making the overnight rate 1%.

- CAD Bank of Canada Rate Decision (SEP 06): 1.00% versus 0.75% expected, from 0.75% as previously.

The Bank of Canada have made it clear that any future interest rate decision will be made exclusively on economic data releases, and as such have not given any further signals to monetary policy decisions. The bank further noted that, "consumer spending remains robust, underpinned by continued solid employment and income growth.There has also been more widespread strength in business investment and in exports".

The Bank of Canada is once again raising its benchmark interest rate as it sees the economy's powerful performance pointing to broader, more self-sustaining growth.

Other economists said another rate increase could be delivered in late October, when the Bank of Canada's governing council next meets.

CIBC economist Avery Shenfeld argued that the timetable for the hike is much tighter, as the BoC could be expected to increase rates this week.

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Though Trump is due to formally announce his decision on Tuesday , sources have cautioned that he could still change his mind. If DACA is ended Tuesday , North Carolina's economy is set to lose more than $1 billion a year, according to CNBC .

That followed unexpectedly healthy growth in the first three months of 2017 and exceeded the Bank of Canada's projections.

What that all means, of course, is that anyone who's overextended on credit - and has been relying on historically low interest rates to keep afloat - could very quickly be in trouble. There was no Monetary Policy Report or news conference to explain a move higher.

The Canadian dollar continued its upward climb on the news, trading up around 81.8 USA cents to gain about 1.2% on the day and 1.6% already this week.

As is often the verbiage of central banks, no future moves are set in stone, as they will be determined by analysis of economic data and other developments. The suggestion is the Canadian dollar gains aren't totally reflective of growth.

The bank also said it will pay close attention to the "sensitivity" of the economy to higher interest rates given "elevated" household indebtedness, and added it will pay "particular focus" to the evolution of the economy's potential growth rate, possibly a suggestion that the economy can run at a faster pace than the bank originally thought without triggering inflation.

But there remains uncertainty over continental free trade talks with the United States and Mexico, and hurricanes pounding the heart of the U.S. refining capacity in the Gulf coast region - given that Canada exports most of its oil to its southern neighbor. Nevertheless, there is still some slack in the labour market while wage and price pressures are still more subdued tan historical relationships would suggest.

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