To: Interest rate watchersFrom: Jeremy M. Kronick and Steve AmblerDate: April 23, 2025Re: The “Great Advantage to Doing Nothing” on Interest Rates After seven straight cuts, the Bank of Canada hit pause last week and held its policy interest rate at 2.75 percent. We have argued over the last few months that the Bank needed to cut the overnight rate […]
Published in the Globe and Mail. After seven straight cuts, the Bank of Canada hit the pause button on Wednesday and held its policy interest rate at 2.75 per cent. We have argued over the last few months that the bank needed to cut the overnight rate to at least get it back to the mid-point of […]
April 10, 2025 – The C.D. Howe Institute’s Monetary Policy Council (MPC) calls for the Bank of Canada to leave its target for the overnight rate, its benchmark policy interest rate, unchanged at 2.75 percent at its next announcement on April 16th. The MPC further calls for the Bank to leave the target at 2.75 percent at […]
Shortly after the Bank of Canada began raising the overnight rate in March 2022, inflation started to move back towards its 2 percent target. However, if we exclude mortgage interest costs, which increased substantially following the rapid rise in the overnight rate, inflation returned to 2 percent much faster. In fact, inflation excluding mortgage interest […]
From: William B.P. RobsonTo: Canadian economic observersDate: March 19, 2025Re: Dollar Weakness is our Best Tariff Defence The Canadian dollar is down about 6 percent against the US dollar since September. The coincidence of its recent ups and downs with the ebb and flow of US President Donald Trump’s tariff threats shows that much of its decline reflects concern about US protectionism. […]
To:Â Interest rate watchersFrom:Â Jeremy M. Kronick and Steve AmblerDate:Â March 18, 2025Re:Â The Way Forward for Interest Rate Cuts The Bank of Canada cut its policy interest rate to 2.75 percent last week Wednesday, its seventh cut in as many announcements. Notwithstanding recent data showing a strong economy at the turn of the year, the needless trade war, […]
Published in The Globe and Mail The Bank of Canada cut its policy interest rate to 2.75 per cent on Wednesday, its seventh cut in as many announcements. Notwithstanding recent data showing a strong economy at the turn of the year, the needless trade war, the flip-flopping US policy, and the uncertainty this has caused […]
March 6, 2025 – The C.D. Howe Institute’s Monetary Policy Council (MPC) calls for the Bank of Canada to lower its target for the overnight rate, its benchmark policy interest rate, to 2.75 percent at its next announcement on March 12th. The MPC further calls for the Bank to leave its target unchanged at 2.75 percent at the […]
The Study in Brief Mortgage interest costs can undergo large swings during tightening and/or loosening cycles by the Bank of Canada. Although they have a weight of only around 5 percent in the Canadian Consumer Price Index (CPI), they can significantly affect movements in the latter as a result of these large swings. The year-over-year […]
March 4, 2025 – After big monetary policy swings, removing mortgage interest costs from the Consumer Price Index (CPI) can provide a clearer picture to the Bank of Canada of where inflation is going, according to a new C.D. Howe Institute report. In “Blurred Vision: How Mortgage Interest Costs Impact Inflation,” Steve Ambler and Jeremy […]
To: Interest rate watchersFrom: Jeremy M. Kronick and Steve AmblerDate: February 4, 2025Re: Think of the Bank’s Latest Rate Cut as Uncertainty Insurance After two cuts of 50 basis points at its last two announcements, the Bank of Canada cut its policy rate by 25 basis points last week. If there was no massive trade threat coming from south of […]
The current gap between the US and Canadian policy interest rates in favour of the former is its largest since the Bank of Canada first went to its Fixed Announcement Date schedule in November 2000. A larger gap in favour of the United States causes a depreciation in the loonie, though its impact has dampened […]
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To: Interest rate watchersFrom: Jeremy M. Kronick and Steve AmblerDate: April 23, 2025Re: The “Great Advantage to Doing Nothing” on Interest Rates After seven straight cuts, the Bank of Canada hit pause last week and held its policy interest rate at 2.75 percent. We have argued over the last few months that the Bank needed to cut the overnight rate […] 
Published in the Globe and Mail. After seven straight cuts, the Bank of Canada hit the pause button on Wednesday and held its policy interest rate at 2.75 per cent. We have argued over the last few months that the bank needed to cut the overnight rate to at least get it back to the mid-point of […] 
April 10, 2025 – The C.D. Howe Institute’s Monetary Policy Council (MPC) calls for the Bank of Canada to leave its target for the overnight rate, its benchmark policy interest rate, unchanged at 2.75 percent at its next announcement on April 16th. The MPC further calls for the Bank to leave the target at 2.75 percent at […] 
Shortly after the Bank of Canada began raising the overnight rate in March 2022, inflation started to move back towards its 2 percent target. However, if we exclude mortgage interest costs, which increased substantially following the rapid rise in the overnight rate, inflation returned to 2 percent much faster. In fact, inflation excluding mortgage interest […] 
From: William B.P. RobsonTo: Canadian economic observersDate: March 19, 2025Re: Dollar Weakness is our Best Tariff Defence The Canadian dollar is down about 6 percent against the US dollar since September. The coincidence of its recent ups and downs with the ebb and flow of US President Donald Trump’s tariff threats shows that much of its decline reflects concern about US protectionism. […] 
The Study in Brief Mortgage interest costs can undergo large swings during tightening and/or loosening cycles by the Bank of Canada. Although they have a weight of only around 5 percent in the Canadian Consumer Price Index (CPI), they can significantly affect movements in the latter as a result of these large swings. The year-over-year […] 
The current gap between the US and Canadian policy interest rates in favour of the former is its largest since the Bank of Canada first went to its Fixed Announcement Date schedule in November 2000. A larger gap in favour of the United States causes a depreciation in the loonie, though its impact has dampened […]