Investing.com - The Bank of Canada left its benchmark interest rate unchanged in October, while dropping its neutral reference about its next policy rate move, it announced on Wednesday.
The BoC said it was leaving its overnight cash rate unchanged at 1%, in line with expectations.
Canada’s real GDP growth is projected to average close to 2.5% over the next year before slowing gradually to 2.0% by the end of 2016, roughly the estimated growth rate of potential output.
Underlying inflationary pressures are muted, given the persistent slack in the economy and the continued effects of competition in the retail sector.
As the economy reaches its full capacity in the second half of 2016, both core and total CPI inflation are projected to be about 2% on a sustained basis.
"Weighing all of these factors, the Bank judges that the risks to its inflation projection are roughly balanced. Meanwhile, the financial stability risks associated with household imbalances are edging higher. Overall, the balance of risks falls within the zone for which the current stance of monetary policy is appropriate and therefore the target for the overnight rate remains at 1%."
BoC Governor Stephen Poloz was to comment on the decision at a press conference later in the day.
USD/CAD was trading at 1.1199 from around 1.1288 ahead of the announcement.