No change to prime

As we thought the Bank of Canada did not do anything to the overnight lending rate.

Here's the full article from CTV.ca


Bank of Canada Governor Mark Carney kept the central bank's trendsetting interest rate unchanged in an announcement Tuesday morning.

The rate remains steady at 1 per cent and will stay there until next year at the earliest.

Carney raised the benchmark rate three times over the summer, but since then the economy has slowed and he has put the increases on hold.

The bank said Canada's economic outlook is not as bright as it was when it issued its last forecast in October. As a result, any interest rate increases would be carefully considered.

In one piece of positive news, the bank said household spending has been stronger than anticipated. But overall, there is room for improvement.

"Governor Mark Carney said there remains significant slack in the Canadian economy -- things are not banging on all cylinders as it were," said BNN's Michael Kane.

"The takeaway from all of this is the recovery is underway, the recovery is taking place, but at a moderate pace."

According to the most recent economic data, Canada's economic growth skidded to 1 per cent in the third quarter of this year. In the second quarter economic growth was double that rate.

On the employment front, November saw a slight rise in part-time work, but a drop in good full-time jobs.

Those numbers came as fewer Canadians were looking for work, meaning the actual numbers might be even higher than the 7.6 per cent on the books.

Manufacturing is also struggling due to the high Canadian loonie, which makes exports less affordable for foreign markets -- one of the factors the central bank said is slowing the economy.

Ahead of the announcement most analysts warned Carney would risk doing major damage if he were to raise the interest rate and it was more likely he would lower expectations for future growth instead.