Bank of Canada Merges Rate Announcement, Policy Reports
The Bank of Canada is moving its interest-rate announcements to Wednesdays from Tuesdays starting in January and merging the release of the decisions with its quarterly economic forecasts.
The last three decisions of this year will continue with the current format of interest-rate decisions on Tuesdays at 9 a.m. in Ottawa unless there is a public holiday, the central bank said today. There will be consultations to determine when on Wednesdays the rate decisions, and Monetary Policy Reports will be released together next year.
The move aims at providing more clarity to investors, who must currently read the central bank’s two key policy documents on separate dates to interpret its thinking.
“Publishing the MPR at the same time as the interest-rate announcement provides full and immediate context for the rate decision, which improves transparency and helps the bank explain its monetary policy more effectively,” the central bank said.
Governor Mark Carney will continue to hold press conferences after the MPR reports are released, the bank said today.
“That’s all to the good, it allows financial markets to have a better grasp of the central bank’s view of the economy,” said Paul Ferley, assistant chief economist at Royal Bank of Canada in Toronto. “In the past they could talk about growth coming in faster than expected and give you a number but it wasn’t clear where in the year the upward revision was.”
The central bank moved to fixed rate-announcement dates in 2000, and said today it “retains the option of making unscheduled rate announcements at any time in the event of extraordinary circumstances.”
The remaining rate decisions for this year are Sept. 5, Oct. 23 and Dec. 4. The next MPR will be released Oct. 24 at 10:30 a.m.
Next year’s announcements are Jan. 23, March 6, April 17, May 29, July 17, Sept. 4, Oct. 23 and Dec. 4. The quarterly economic forecasts will be published with the decisions in January, April, July, and October.
The benchmark interest rate has been at 1 percent since September 2010, the longest pause since the 1950s.
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