The Financial institution of Canada determined to maintain its benchmark rate of interest regular at a record-low 0.25 per cent on Wednesday.
The central financial institution additionally stated it might preserve its bond purchases at a goal tempo of $3 billion per week, an indication of constant financial assist whereas financial exercise picks up.
Regardless of one other wave of COVID-19, first-quarter financial development got here in at a “strong” 5.6 per cent, the financial institution stated.
“Whereas this was decrease than the financial institution had projected, the underlying particulars point out rising confidence and resilient demand. Family spending was stronger than anticipated, whereas companies drew down inventories and elevated imports greater than anticipated.”
Nonetheless, renewed lockdowns and different restrictions as a result of third wave of the pandemic are dampening financial exercise within the second quarter, largely as anticipated, the central financial institution stated.
It stated the employment charge stays effectively beneath its pre-pandemic degree, with low-wage employees, youth and girls persevering with to bear the brunt of job losses.
The important thing lending charge has been on maintain at its rock-bottom degree because the onset of the pandemic final yr and the central financial institution has stated it will not improve the speed till the economic system has recovered.
Wednesday’s announcement factors to a restoration a while within the second half of 2022.