Key Interest Rate Could Soon Go up Another Half Percentage Point, Central Bank Says

By The Canadian Press
The Canadian Press
The Canadian Press
April 25, 2022 Updated: April 25, 2022

The governor of the Bank of Canada is signalling Canada’s key interest rate could go up another half percentage point in June to help wrestle inflation under control.

Tiff Macklem is appearing at the House of Commons standing committee on finance today.

Two weeks ago the central bank raised its key interest rate a half point to one percent and warned more rate hikes would be coming as it works toward an inflation target of two percent.

Macklem says the bank will be considering another oversized, half-percentage-point interest rate increase at its next rate decision in June.

Canada’s inflation rate hit a three-decade high of 6.7 percent in March, well above what the central bank projected in its January monetary policy report.

Macklem says Russia’s invasion of Ukraine has driven up the cost of energy and other commodities, and is further disrupting global supply chains, but says there is also domestic pressure on prices.