Stephen Poloz, Governor of the Bank of Canada, recently announced another increase in the overnight interest rate – which is the Bank’s “policy interest rate – or PIR.” That has an impact on other interest rates in the economy. The statement from the Bank also indicated that there were likely more increases to come. It was stated that the Bank is aiming to get the bank rate closer to or at the “neutral rate of interest.
If you would like to try your hand at forecasting what will happen with interest rates, and learn more about how the Bank goes about deciding upon, and implementing, monetary policy, click here to link to Module 9 of CFEE’s new Money and Monetary Policy in Canada website. The Module will provide a full background explanation for you and your students. Then you can all try being the Governor and see if you can predict, next time, what the Bank will do.
If you would like to access the entire new Money and Monetary website, with lots of background on money, our financial system, interest rates, and exchange rates, please click here. There are Teacher’s Guides provided there for each Module – as well as a link to the latest news from the Bank which is where you can also access the statement from the Bank about the rate change