News Analysis
OTTAWA—The Bank of Canada stated that it will take a pause from raising interest rates after its quarter-point (25 basis points) hike to 4.5 percent on Jan. 25. It was an unusual move that required considerable elaboration.
Governor Tiff Macklem was quick to pour cold water on the subsequent emerging talk of rate cuts. One consequence of this is higher mortgage costs—especially for variable-rate loans.
“We have raised rates rapidly, and now it’s time to pause and assess whether monetary policy is sufficiently restrictive to bring inflation back to the 2 percent target,” Macklem said in opening remarks at the bank’s press conference….