The Bank of Canada held its benchmark interest rate steady at 5.0 per cent on Wednesday and hinted that its tightening cycle might have peaked.
The decision, which marks the fourth consecutive hold from the central bank, was widely expected by economists.
According to prepared remarks from Bank of Canada governor Tiff Macklem, conversations at the central bank have shifted from debating whether interest rates are high enough to how long the central bank needs to keep rates at current levels.
"We are trying to balance the risks of over- and under-tightening. We don't want to cool the economy more than necessary, but we don't want Canadians to have to continue to live with elevated inflation either," Macklem said.
Heading into Wednesday’s decision, market watchers had started to forecast a timeline for rate cuts, with calls for easing to start between spring and summer of 2024.
At the press conferenced, Macklem was joined by Senior Deputy Governor Carolyn Rogers.
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