The Bank of Canada keeps interest rates at 4.50%. In a highly expected move, the Bank of Canada left the interest rate unchanged at its meeting moments ago, at 4.50% basis, to reach 4.50%.

The bank’s interest report stated that economic growth stabilized in the fourth quarter of last year, i.e. less than what the bank expected, with increased consumption and government spending, while the labor market is still very tight.

Employment growth was surprisingly strong, as unemployment rates stabilize near their lowest historical levels. Inflation fell to 5.9% in January, reflecting smaller increases in energy, commodity and some services prices, but the latest data remains consistent with the Bank’s expectations that inflation will drop to about 3% in the middle of this year.

The Board of Directors will continue to evaluate economic developments and the impact of recent interest rate increases and is prepared to increase interest rates again if necessary to bring inflation back to the 2% target.