The Bank of Canada held its benchmark interest rate steady on Wednesday amid signs that inflation is easing.
The central bank's policy rate, which informs lending rates on key products like Canadian mortgages, remains at 5.0 per cent for the sixth straight decision.
The hold was widely expected by economists as signs indicate price pressures are easing, growth in the economy has stalled and the once-tight labour market is softening.
Bank of Canada Gov. Tiff Macklem said in prepared remarks accompanying the rate decision that recent data has given the central bank more confidence that “inflation will continue to come down gradually even as economic activity strengthens.”
Asked about whether an interest rate cut in June was on the table, he said it was “in the realm of possibilities.”
The Bank of Canada's rate tightening cycle began more than two years ago in an effort to rein in decades-high levels of inflation.
Annual inflation has since cooled significantly, last coming in at 2.8 per cent in February. That's within the Bank of Canada's target range of one-to-three per cent, but the central bank has maintained it won't ease its policy rate until it's confident price pressures will continue to decline all the way back to two per cent.
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