THE DAVISVILLE & LEASIDE INSIDER

THE DAVISVILLE & LEASIDE INSIDER

Friday, May 21, 2010

Inflation picture points to steady hikes in interest rates

Canadians should be prepared for slow and steady hikes in interest rates after larger-than-expected increases in core inflation and consumer prices, according to a top economist with RBC Capital Markets.

“To be sure, the volatility in global financial markets and worries that funding costs will move back up may see the (The Bank of Canada) stay the course until financial markets have settled down,” Dawn Desjardins wrote in a note.

“Our read is that domestic economic fundamentals no longer warrant the policy rate at its current emergency-low levels and we expect the Bank to start a program of steady, gradual rate hikes soon,” starting as expected at the beginning of next month, said Desjardins.

Source: Emily Mathieu, Business Reporter
www.thestar.com
Published 1 hour 10 minutes ago


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