On December 7th 2022, The Bank of Canada raised their interest rate by 0.50% to 4.25%, with the bank rate at 4.5% and deposit rate at 4.25%. The Bank also stated that they are continuing the policy of quantitative tightening.

The GDP growth in Canada has been stronger than expected and the economy still continued to operate in excess demand. The labour market still remains tight, with unemployment still at an all time low. There is much growing evidence that monetary policy is restraining domestic demand and the housing market continues to decline.
 

The CPI inflation rate still remains at 6.9% in October, with measures of core inflation at 5%.Three months of change in core inflation have come down which is an early indicator that price pressure may be losing some momentum. Still, inflation remains too high and short term inflation still remains elevated.
 

In the future, Governing Councils will be considering if the policy rates need to be raised to bring supply and demand into place and return inflation back to the target. Quantitative tightening is suggesting to increase the policy rates more. The Bank of Canada is still committed to achieving the 2% inflation rate target and restoring a price sustainable to Candians.

The next scheduled date for announcing overnight rate changes is January 25, 2023.