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Essentials of Monetary Policy

Bank of Canada (BoC). Key Rates Will Probably Stay at Their Lower Bound until 2023

October 28, 2020
François Dupuis • Mathieu D’Anjou • Benoit P. Durocher • Hendrix Vachon

For the first time since the beginning of the pandemic, the new MPR includes a detailed economic and financial scenario. Overall, the BoC’s projections are similar to our most recent forecasts. In addition, after a spectacular rebound in the Canadian real GDP in the third quarter thanks to the reopening of the economy, very modest growth is expected in the fourth quarter due to the negative effects of the second wave of COVID-19. Real GDP growth should pick up speed in early 2021, but everything will depend greatly on how the pandemic evolves.