The Bank of Canada raised its key interest rate another 25 basis points Wednesday morning, making it the third increase since June.
BoC Governor Mark Carney’s move to increase the overnight lending rate from 0.75 per cent to 1 per cent suggests the bank is confident with Canada’s economic recovery and that monetary stimulus can be relaxed.
Still, Canadian gross domestic product (GDP) didn’t meet the bank’s expectations for the second quarter, rising only 2 per cent instead of 3 per cent.
Second quarter growth represents an even sharper decline compared to the previous quarter when GDP was 5.8 per cent.
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