On April 10, 2024, the Bank of Canada decided to maintain the overnight rate at 5 per cent. They observed that the Canadian economy is currently experiencing an imbalance between supply and demand, but they remain optimistic about future growth prospects.

In terms of prices, the Bank noted that inflation is still too high, particularly in housing costs. However, they also recognized a recent slowdown in the rate of price increases. They emphasized their commitment to monitoring this trend closely.

Many experts in finance believe that this decision signals the beginning of a series of rate cuts, possibly starting in June. This expectation is based on recent data showing increased unemployment and subdued inflation when housing costs are excluded. Given the Bank’s role in influencing mortgage rates and housing supply, there’s speculation they may try to stimulate the economy by gradually reducing rates. It’s anticipated that this could happen multiple times throughout the year, with the goal of reaching an overnight rate of 2.5 per cent by the end of 2025.