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Home » Forex Glossary » Bank of Canada Rate Decision

Bank of Canada Rate Decision

A decision made by the Bank of Canada to alter or maintain its interest so as to maintain the Bank’s inflation target of 1 to 3 percent. An increase in the interest rate tends to decrease private investment and economic growth, thereby lowering inflation. A decrease in the interest rate has the opposite effect. The fact that the Bank of Canada has an inflation target (and sets its interest rate accordingly) means that these rate decisions will invariably impact global financial markets.