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Bank of Canada announces rate hike to 1.5%

After the Bank of Canada's interest rate meeting last night, as expected by the market, it announced a 50 basis point rate hike to 1.5%, the third rate hike this year. The central bank said in a statement that due to excess demand in the economy, inflation continued to be significantly above target. Given that the risk of high inflation becoming entrenched has risen, it is judged that further increases in interest rates will be required. At present, the policy interest rate is still the main policy tool, and quantitative tightening is an auxiliary tool. Although the Bank of Canada hinted that further interest rate hikes are needed to curb inflation in the future, and seeing that the 1.5% interest rate has become the second-highest among the seven major currencies, next to the New Zealand dollar, it is expected to help the Canadian dollar to maintain a certain level of interest in the current central bank interest rate hike. Competitiveness.
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