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☆ Bank of Canada leaves rates on hold, sees weak growth and stubborn inflation
▼ + stars: | 2023-10-25 | by ( ) www.reuters.com time to read: +3 min

[1/2] Governor of the Bank of Canada Tiff Macklem walks outside the Bank of Canada building in Ottawa, Ontario, Canada June 22, 2020. The bank increased rates 10 times between March 2022 and this July, with inflation peaking at more than 8% last year. Inflation in September dipped to 3.8% from 4.0% in August, and the central bank said it would average 3.5% through mid-2024. "There is growing evidence that past interest rate increases are dampening economic activity and relieving price pressures," the Bank of Canada (BoC) said in a statement. In July, the BoC forecast third-quarter annualized growth of 1.5%.

Persons: Blair Gable, Steve Scherer, David Ljunggren OTTAWA, David Ljunggren Organizations: Bank of Canada, REUTERS, Wednesday, BoC, Reuters, Thomson Locations: Ottawa , Ontario, Canada, Israel, Gaza, Reuters Ottawa

☆ Canadian dollar hits 7-month low as BoC stays sidelined
▼ + stars: | 2023-10-25 | by ( Fergal Smith | ) www.reuters.com time to read: +2 min

A Canadian dollar coin, commonly known as the "Loonie", is pictured in this illustration picture taken in Toronto, January 23, 2015. The Canadian central bank held its key overnight rate at a 22-year high of 5.0%, as expected, for a second straight meeting. Wall Street fell after lackluster corporate results, while the U.S. dollar (.DXY) rallied against a basket of major currencies. Canadian government bond yields were higher across a steeper curve but the move for shorter-dated maturities was less than for the equivalent U.S. Treasury yields. The 2-year rose 2.9 basis points to 4.749%, while the 10-year was up 11.3 basis points at 4.131%.

Persons: Mark Blinch, Tom O'Gorman, we're, Michael Goshko, maturities, Fergal Smith, Sandra Maler Organizations: REUTERS, greenback, BoC, Canadian, U.S, Bank of, Franklin Templeton, Convera Canada, U.S ., Treasury, Thomson Locations: Toronto, TORONTO, Canadian, Franklin Templeton Canada, Wall

☆ Analysis: China to choose fiscal muscle over big reforms to revive economy
▼ + stars: | 2023-10-24 | by ( Kevin Yao | ) www.reuters.com time to read: +5 min

The foundation of economic recovery is not solid," said an adviser to the cabinet who spoke on condition of anonymity. The debate about economic policy in China has heated up in recent months with some government advisers advocating reforms to help unleash new growth engines beyond property and infrastructure investment. For those looking for structural reforms, the focus is on policies that spur urbanisation and household spending power, reduce the reliance on investment and level the playing field between state-owned enterprises and private firms. "Fiscal policy should still play the leading role next year," said Xu Hongcai, deputy director of the economic policy commission at the state-backed China Association of Policy Science. "We should push reforms as many problems are structural, but reforms are difficult to implement and require political will," said one policy insider.

Persons: Xu Hongcai, Xu, Guan Tao, Kevin Yao, Sam Holmes Organizations: Reuters, China Association of Policy, BOC International, State Administration of Foreign Exchange, Communist, Thomson Locations: China, BEIJING, Beijing

☆ China to choose fiscal muscle over big reforms to revive economy
▼ + stars: | 2023-10-24 | by ( Kevin Yao | ) www.reuters.com time to read: +5 min

☆ Bank of Canada to leave rates on hold as economy stalls, analysts say
▼ + stars: | 2023-10-23 | by ( Steve Scherer | ) www.reuters.com time to read: +2 min

Governor of the Bank of Canada Tiff Macklem walks outside the Bank of Canada building in Ottawa, Ontario, Canada June 22, 2020. REUTERS/Blair Gable/File Photo Acquire Licensing RightsOTTAWA, Oct 23 (Reuters) - The Bank of Canada (BoC) will leave interest rates on hold on Wednesday as the economy stalls, analysts said, though many see the central bank warning that future hikes are still possible with inflation hovering well above its 2% target. Weak growth and a modest easing of inflation "should keep the Bank of Canada on hold," he said. Earlier this month, BoC Governor Tiff Macklem said the economy was not heading for a "serious recession". Macklem "will need to sound sufficiently hawkish to retain current market pricing, which more or less has the Bank of Canada holding rates steady until 2025."

Persons: Blair Gable, Karl Schamotta, Macklem, Royce Mendes, Steve Scherer, Jonathan Oatis Organizations: Bank of Canada, REUTERS, Rights OTTAWA, BoC, Cambridge Global Payments, Desjardins Group, of Canada, Thomson Locations: Ottawa , Ontario, Canada

☆ BoC likely done raising rates, to cut by mid-2024 say economists: Reuters poll
▼ + stars: | 2023-10-20 | by ( Milounee Purohit | ) www.reuters.com time to read: +4 min

The risk of a revival in inflation, last measured at 3.8%, has led most to forecast now is not the time for the central bank to strongly signal they are done raising rates. Twenty-nine of 32 economists polled Oct. 13-20 expect no change to the central bank's 5.00% overnight rate (CABOCR=ECI), with the remaining three expecting a 25 basis point hike. While most are confident the central bank is done hiking, a significant minority of economists who answered an additional question, 8 of 18, said the risk of the BoC raising rates at least once more is "high". Still, a two-thirds majority, 20 of 30, see the BoC cutting its overnight rate at least once before end-June 2024. The distribution of where economists saw the overnight rate by end-June was split many ways.

Persons: Randall Bartlett, underscoring, Tony Stillo, Milounee Purohit, Maneesh Kumar, Ross Finley, Jonathan Oatis Organizations: Bank of Canada, BoC, Desjardins, U.S . Federal Reserve, Oxford Economics, Bank, Thomson Locations: BENGALURU, Canada

REUTERS/Carlos Osorio/File Photo Acquire Licensing RightsOTTAWA, Oct 17 (Reuters) - Canada's annual inflation rate unexpectedly slowed to 3.8% in September and underlying core measures also eased, data showed on Tuesday, prompting markets and analysts to trim bets for another interest rate hike next week. Analysts polled by Reuters had forecast inflation to hold steady at the 4.0% rate recorded in August. Two of the Bank of Canada's (BoC's) three core measures of underlying inflation also decelerated. Money markets trimmed bets for a rate hike next week after the data. "There's no need for further rate hikes in Canada," Reitzes said.

Persons: Carlos Osorio, Jules Boudreau, stoking, Benjamin Reitzes, Reitzes, Statscan, Derek Holt, Macklem, Ismail Shakil, Steve Scherer, Dale Smith, Fergal Smith, Divya Rajagopal, Jonathan Oatis, Nick Zieminski Organizations: REUTERS, Rights OTTAWA, Reuters, Statistics, Mackenzie Investments, Bank of Canada's, Bank of Canada, BoC, BMO Capital Markets, Scotiabank . Bank of Canada, Thomson Locations: Toronto , Ontario, Canada, Statistics Canada, Mackenzie, Ottawa, Toronto

☆ Canadian dollar hits 6-month low as bond yields soar
▼ + stars: | 2023-10-03 | by ( Fergal Smith | ) www.reuters.com time to read: +2 min

A Canadian dollar coin, commonly known as the "Loonie", is pictured in this illustration picture taken in Toronto, January 23, 2015. "It's been dragged around with higher U.S. yields, that's for sure," said Amo Sahota, director at Klarity FX in San Francisco. "The U.S. dollar has been on an 11-week run to the upside, so that's not necessarily helping the loonie." Vincent's comments helped underpin Canadian bond yields, Sahota said, adding that the market is "still gunning for another rate hike" from the Canadian central bank. Canadian government bond yields surged across the curve, playing catch-up with moves in U.S. Treasuries after the Canadian market was closed on Monday.

Persons: Mark Blinch, It's, Amo Sahota, Nicolas Vincent said, Vincent's, Sahota, gunning, Fergal Smith, Richard Chang Organizations: REUTERS, greenback, Canadian, U.S, Bank of Canada, FX, BoC, Treasuries, Thomson Locations: Toronto, TORONTO, San Francisco, U.S, Canadian

☆ Canadian dollar edges higher as 10-year yield hits 4%
▼ + stars: | 2023-09-25 | by ( Fergal Smith | ) www.reuters.com time to read: +2 min

A Canadian dollar coin, commonly known as the "Loonie", is pictured in this illustration picture taken in Toronto, January 23, 2015. The loonie was trading 0.1% higher at 1.3470 to the greenback, or 74.24 U.S. cents, after moving in a range of 1.3455 to 1.3491. Among G10 currencies, only the Swedish crown performed better than the Canadian currency, as the U.S. dollar (.DXY) extended its recent gains against a basket of major currencies. Still, speculators have raised their bearish bets on the Canadian dollar to the most since May, data from the U.S. Commodity Futures Trading Commission showed on Friday. The 10-year was up 11.2 basis points at 4.026%, its first move above the 4% threshold since January 2008.

Persons: Mark Blinch, Price, Tony Valente, Fergal Smith, Nick Zieminski Organizations: REUTERS, greenback, U.S, Federal Reserve, Bank of Canada, U.S ., Fed, BoC, U.S . Commodity Futures Trading, Thomson Locations: Toronto, TORONTO, Swedish, Russia, U.S

☆ Trudeau expects Canadian interest rates to come down by mid 2024
▼ + stars: | 2023-09-23 | by ( ) www.reuters.com time to read: +2 min

REUTERS/Mike Segar/File Acquire Licensing Rights Read moreSept 23 (Reuters) - Canadian Prime Minister Justin Trudeau expects interest rates are going to start coming down by the middle of next year, in-line with recent Reuters poll estimates, though the latest economic data has turned the central bank more hawkish. We think interest rates are going to start coming down probably middle of next year," Trudeau told the New York Times in an interview just before returning to Canada after attending the United Nations General Assembly. Trudeau's popularity as measured by opinion polls has dropped as Canadians deal with a cost-of-living crisis, sparked by the central bank's record pace of interest rate increases to tame inflation. Trudeau has waded into a sensitive monetary policy debate and past comments on interest rates by his government and other provincial politicians have raised questions about the independence of the central bank. Reporting by David Ljunggren in Ottawa Writing by Denny Thomas, Editing by Franklin PaulOur Standards: The Thomson Reuters Trust Principles.

Persons: Justin Trudeau, Mike Segar, Trudeau, Macklem, Chrystia Freeland, Pierre Poilievre, David Ljunggren, Denny Thomas, Franklin Paul Organizations: Canadian, REUTERS, New York Times, United Nations General Assembly, Bank of Canada, BoC, U.S . Federal Reserve, Finance, Minister's, Conservative Party Leader, Franklin Paul Our, Thomson Locations: New York, U.S, Canada, Ottawa

The Canadian central bank had expected productivity, or output per hour worked, to improve as the economy recovered from the COVID-19 pandemic. Instead, it has fallen in eleven of the last 12 quarters, taking it back to its 2016 level. It also stands to add to unit labor costs, a key measure of inflation pressures coming from higher wages. "Our own forecast is that productivity growth will turn around, but that is a risk to the outlook and if productivity growth continues declining it will make it more difficult to get inflation back to target," Macklem said. The central bank has forecast that inflation will return to its 2% target in the middle of 2025.

Persons: Macklem, Derek Holt, tightens, Holt, Dennis Darby, Doug Porter, Fergal Smith, Steve Scherer, Deepa Babington Organizations: Bank of Canada, Reuters Graphics Reuters, BoC, Scotiabank, Federal Reserve, Canadian Manufacturers, Fraser Institute, BMO Capital Markets, Thomson Locations: Canadian, Canada, freefall, United States, Toronto, Ottawa

☆ Bank of Canada struck intentionally hawkish tone after last rate decision, minutes show
▼ + stars: | 2023-09-20 | by ( ) www.reuters.com time to read: +2 min

A sign is pictured outside the Bank of Canada building in Ottawa, Ontario, Canada, May 23, 2017. The Bank of Canada (BoC) kept its key rate at 5% on Sept 6, noting the economy had entered a period of weaker growth, but said it could hike again should price pressures persist. The hawkish tone struck by the BoC since the latest rate decision was intentional, according to the minutes, or summary of deliberations, of the six Governing Council members. They "considered the possibility that their decision could be misinterpreted as a sign that policy tightening had ended and that lower interest rates would follow," the summary read. It continued: "They agreed that they did not want to raise expectations of a near-term reduction in interest rates, given that they only considered keeping the policy rate where it is or raising it further."

Persons: Chris Wattie, Steve Scherer, David Ljunggren OTTAWA, Sharon Kozicki, David Ljunggren Organizations: Bank of Canada, REUTERS, The Bank of Canada, BoC, Reuters, Thomson Locations: Ottawa , Ontario, Canada, Reuters Ottawa

☆ Canadian dollar gives back earlier gains on hawkish Fed
▼ + stars: | 2023-09-20 | by ( Fergal Smith | ) www.reuters.com time to read: +2 min

A Canadian dollar coin, commonly known as the "Loonie", is pictured in this illustration picture taken in Toronto January 23, 2015. The Fed held interest rates steady but projected another rate increase by the end of the year and monetary policy kept significantly tighter through 2024 than previously expected. "The U.S. dollar is climbing against its major rivals as Treasury yields push higher across the front-end of the curve, and risk-sensitive assets - from equities to the Canadian dollar - are weakening," Karl Schamotta, chief market strategist at Corpay, said in a note. The Canadian dollar was trading nearly unchanged at 1.3450 to the greenback, or 74.35 U.S. cents, after trading in a range of 1.3396 to 1.3464. The price of oil, one of Canada's major exports, settled 1% lower at $90.28 a barrel, giving back some recent gains.

Persons: Mark Blinch, Price, Karl Schamotta, Fergal Smith, Nick Zieminski Organizations: REUTERS, Canadian, U.S, U.S . Federal, Fed, Bank of Canada, BoC, Thomson Locations: Toronto, TORONTO, Canadian

☆ Hot inflation data helps lift Canadian dollar to 6-week high
▼ + stars: | 2023-09-19 | by ( Fergal Smith | ) www.reuters.com time to read: +2 min

A Canadian dollar coin, commonly known as the "Loonie", is pictured in this illustration picture taken in Toronto, January 23, 2015. The Canadian dollar was trading 0.3% higher at 1.3440 to the greenback, or 74.40 U.S. cents, after touching its strongest intraday level since Aug. 10 at 1.3383. Canada's annual inflation rate in August jumped to 4.0% from 3.3% in July on higher gasoline prices. "The oversold nature of the Canadian dollar going into the release suggests that exchange rate gains could be generated in the shorter term." Speculators have raised their bearish bets on the Canadian dollar to the highest since May, data from the U.S. Commodity Futures Trading Commission showed on Friday.

Persons: Mark Blinch, Karl Schamotta, Sharon Kozicki, Fergal Smith, Nick Zieminski, Sandra Maler Organizations: REUTERS, greenback, Canadian, U.S, Bank of Canada, Reuters, Bank of Canada's, U.S . Commodity Futures Trading, BoC, Thomson Locations: Toronto, TORONTO, Canadian

☆ Dubai Aerospace flags corrosion in plane leased to India's bankrupt Go First
▼ + stars: | 2023-09-14 | by ( Arpan Chaturvedi | ) www.reuters.com time to read: +2 min

REUTERS/Adnan Abidi/File Photo Acquire Licensing RightsNEW DELHI, Sept 14 (Reuters) - Dubai Aerospace Enterprise (DAE) Capital has told an Indian court it detected corrosion of some parts and "a greenish deposit" on a plane leased to bankrupt airline Go First, after another lessor complained about "robbed" parts. The lessors currently are only allowed an occasional inspection of the grounded Go First planes, which DAE and others claim are not being properly maintained. DAE court documents show it was worried about a lack of covers on cabin and cockpit seats "which would eventually lead to fungus formation", according to an internal e-mail contained in the filing. Indian media outlet Mint reported on Thursday that another lessor, BOC Aviation, also told the Delhi court about algae formation as the planes were not covered. Go First lessor SMBC Aviation Capital Aviation in May told an Indian court that Indian bankruptcy law, which blocks plane repossession, will jolt the market and spark a confidence crisis.

Persons: Adnan Abidi, DAE, Arpan Chaturvedi, Aditya Kalra Organizations: REUTERS, Dubai Aerospace Enterprise, Go, ACG Aircraft Leasing, BOC Aviation, SMBC Aviation Capital Aviation, Thomson Locations: New Delhi, India, DELHI, Delhi

Canada created 39,900 jobs, Statistics Canada said, compared with a median forecast for a gain of 15,000. The labor market has been resilient even as the Bank of Canada (BoC) raised its key overnight rate 10 times since March 2022 to cool the economy. Money markets see a 44% chance of another BoC rate hike by year-end, up from 36% before the data were published. "This report alone won't make the Bank of Canada regret holding rates steady earlier this week. Derek Holt, vice president of capital markets economics at Scotiabank, noted a gain of 49,500 people in self-employed jobs.

Persons: Carlos Osorio, Andrew Kelvin, Royce Mendes, Derek Holt, Dale Smith, Fergal Smith, Andrea Ricci, Nick Macfie Organizations: Queen, West, REUTERS, Rights, Statistics, Bank of Canada, BoC, TD Securities, Desjardins Group, Canadian, Scotiabank, Thomson Locations: Toronto Ontario, Canada, Statistics Canada, Canadian, Ottawa, Toronto

☆ Canadian dollar rallies as jobs data rekindles rate hike bets
▼ + stars: | 2023-09-08 | by ( Fergal Smith | ) www.reuters.com time to read: +2 min

File photo: A Canadian dollar coin, commonly known as the "Loonie", is pictured in this illustration picture taken in Toronto, January 23, 2015. The loonie was trading 0.4% higher at 1.3620 to the greenback, or 73.42 U.S. cents, after moving in a range of 1.3609 to 1.3689. Money markets see a 44% chance of another BoC rate hike by year-end, up from 36% before the data. The jobs data is "not strong enough to prompt an immediate rethink on the pause, but it's also certainly not soft enough to rule out further hikes", Doug Porter, chief economist at BMO Capital Markets, said in a note. The Canadian 2-year yield rose 3.3 basis points to 4.643%, while the gap between it and its U.S. equivalent narrowed by 5 basis points to 29.5 basis points in favor of the U.S. note.

Persons: Mark Blinch, it's, Doug Porter, Fergal Smith, Mark Heinrich Our Organizations: REUTERS, greenback, Canadian, U.S, Bank of Canada, BoC, BMO Capital Markets, U.S ., Thomson Locations: Toronto, Canada, TORONTO

☆ Canada finance minister defends central bank independence after rate comment
▼ + stars: | 2023-09-07 | by ( ) www.reuters.com time to read: +2 min

REUTERS/Thomas White/Illustration Acquire Licensing RightsSept 6 (Reuters) - Canadian Finance Minister Chrystia Freeland defended the central bank's independence on Wednesday after her comments welcoming the Bank of Canada's decision not to increase its key interest rate raised concerns to the contrary. In a widely expected decision, the Bank of Canada held interest rates steady at a 22-year high of 5%. It is rare for Canadian government ministers to publicly back or criticize central bank policies. Like many developed economies, the Bank of Canada makes its monetary policy decisions independent of the federal government. In June, when the central bank raised rates for the first time after a four-month pause, Freeland stressed that she respected the independence of the central bank, a sentiment she repeated in a press conference later in the day.

Persons: Thomas White, Chrystia Freeland, Freeland, Derek Holt, Pierre Poilievre, Justin Trudeau's, Steve Scherer, David Ljunggren, Denny Thomas, Leslie Adler Organizations: Canadian Finance, Bank of, Bank of Canada, Conservative, Liberal, Ontario, Thomson Locations: Canada, Bank of Nova Scotia, British Columbia, Ottawa

☆ Bank of Canada says interest rates may not be high enough
▼ + stars: | 2023-09-07 | by ( ) www.reuters.com time to read: +3 min

Bank of Canada Governor Tiff Macklem takes part in a news conference after announcing an interest rate decision in Ottawa, Ontario, Canada April 12, 2023. REUTERS/Blair Gable/File Photo Acquire Licensing RightsBy Steve Scherer and David LjunggrenOTTAWA, Sept 7 (Reuters) - Bank of Canada Governor Tiff Macklem on Thursday said interest rates may not be high enough to bring inflation back down to target, sending a hawkish message after holding borrowing costs at a 22-year high a day earlier. The central bank hiked rates by a quarter point in both June and July in a bid to tame stubbornly high inflation. "We don't want to raise our policy rate more than we have to," Macklem said, adding that persistently high inflation would be worse for Canadians than high borrowing costs. (Reporting by Steve Scherer, editing by David Ljunggren)((Reuters Ottawa bureau, david.ljunggren@tr.com))Keywords: CANADA CENBANK/Our Standards: The Thomson Reuters Trust Principles.

Persons: Blair Gable, Steve Scherer, David Ljunggren OTTAWA, Macklem, Chrystia Freeland, David Ljunggren Organizations: Canada, REUTERS, Bank of Canada, BoC, federal, Reuters, Thomson Locations: Ottawa , Ontario, Canada, Calgary , Alberta, Reuters Ottawa

☆ Three major China banks to lower rates on existing first-home mortgages
▼ + stars: | 2023-09-07 | by ( ) www.reuters.com time to read: +1 min

People walk past a branch of Industrial and Commercial Bank of China (ICBC) in Beijing, China April 1, 2019. REUTERS/Florence Lo/File Photo Acquire Licensing RightsBEIJING, Sept 7 (Reuters) - Three of China's major state banks said on Thursday they will start to lower interest rates on existing mortgages for first-home loans. Interest rates on existing first-home loans will be cut to the level in place when a home was purchased, the Industrial and Commercial Bank of China Ltd (ICBC) (601398.SS), Agricultural Bank of China (601288.SS) and Bank of China Ltd (BOC) (601988.SS) said in statements. China's home loans totalled 38.6 trillion yuan ($5.3 trillion) at the end of June, representing 17% of banks' total loan books. ($1 = 7.3232 Chinese yuan)Reporting by Ziyi Tang and Ryan Woo; Editing by Edwina GibbsOur Standards: The Thomson Reuters Trust Principles.

Persons: Florence, Ziyi Tang, Ryan Woo, Edwina Gibbs Organizations: Industrial, Commercial Bank of China, REUTERS, Rights, Commercial Bank of China Ltd, Agricultural Bank of China, Bank of China Ltd, BOC, Thomson Locations: Beijing, China, Rights BEIJING

☆ Bank of Canada holds rates, says it could hike further if inflation persists
▼ + stars: | 2023-09-06 | by ( ) www.reuters.com time to read: +2 min

Bank of Canada Governor Tiff Macklem takes part in a news conference after announcing an interest rate decision in Ottawa, Ontario, Canada April 12, 2023. The central bank hiked rates by a quarter point in both June and July in a bid to tame stubbornly high inflation, which has remained above the bank's 2% target for 27 months. "Governing Council remains concerned about the persistence of underlying inflationary pressures, and is prepared to increase the policy interest rate further if needed." Liberal Prime Minister Justin Trudeau's support has sagged amid high inflation as his Conservative rival, Pierre Poilievre, hammered him for fueling inflation with government spending and driving up rates during a housing crisis. Bank of Canada Governor Tiff Macklem will deliver a speech and hold a press conference to discuss the decision on Thursday.

Persons: Blair Gable, Steve Scherer, David Ljunggren OTTAWA, Justin Trudeau's, Pierre Poilievre, David Ljunggren Organizations: Canada, REUTERS, Bank of Canada, Wednesday, Governing, of Canada, BoC, Liberal, Conservative, Reuters, Thomson Locations: Ottawa , Ontario, Canada, Reuters Ottawa

☆ Morning Bid: Shedding pounds, buying dollars
▼ + stars: | 2023-09-06 | by ( ) www.reuters.com time to read: +2 min

The German share price index DAX graph is pictured at the stock exchange in Frankfurt, Germany, August 29, 2023. Investors are also focusing on English football club Manchester United (MANU.N), whose shares fell 18% on Tuesday in their steepest one-day decline. Brent crude is above $90 a barrel after Saudi Arabia and Russia extended their voluntary supply cuts to the end of the year. Weakness in demand will be the focus of data today as Germany releases July manufacturing data and the euro zone shows us what retailers were doing in July. Not much, going by the share price of French luxury group LVMH (LVMH.PA), which was just dethroned from pole position in Europe's most-valuable list.

Persons: Vidya Ranganathan, Glazer, Sterling, Philip Morris, Brent, Edmund Klamann Organizations: REUTERS, Staff, Vidya, Investors, English, Manchester United, Unilever Capital Corp, Philip Morris International, Volkswagen, Labor, Canada BOC, Thomson Locations: Frankfurt, Germany, Danish, Saudi Arabia, Russia, Europe's, Poland, U.S, Canada

Bank of Canada Governor Tiff Macklem takes part in a news conference after announcing an interest rate decision in Ottawa, Ontario, Canada April 12, 2023. REUTERS/Blair Gable/File Photo Acquire Licensing RightsOTTAWA, Sept 6 (Reuters) - The Bank of Canada on Wednesday is expected to keep rates on hold at a 22-year high of 5% after the economy unexpectedly shrank in the second quarter, analysts said. While the economy turned negative in the second quarter, inflation has been stubborn, unexpectedly rising to 3.3% in July as core measures remained well above 3%. Canada's Liberal Prime Minister Justin Trudeau's support has sagged amid high inflation as his Conservative rival, Pierre Poilievre, hammered him for feeding inflation with government spending and driving up rates during a housing crisis. But core inflation measures are inching down slowly, and a wealth of data is due out before the bank next meets to discuss rates in October.

Persons: Blair Gable, Derek Holt, Justin Trudeau's, Pierre Poilievre, Tiago Figueiredo, Holt, Steve Scherer, Mark Porter Organizations: Canada, REUTERS, Rights, Bank of Canada, of Canada, Scotiabank, Canada's Liberal, Conservative, Bank of Canada's, Desjardins Group, Reuters, BoC, Thomson Locations: Ottawa , Ontario, Canada

Bank of Canada Governor Tiff Macklem takes part in a news conference after announcing an interest rate decision in Ottawa, Ontario, Canada April 12, 2023. The central bank hiked rates by a quarter point in both June and July in a bid to tame stubbornly high inflation, which has remained above the bank's 2% target for 27 months. Bank of Canada Governor Tiff Macklem will deliver a speech and hold a press conference to discuss the decision on Thursday. Reuters GraphicsLiberal Prime Minister Justin Trudeau's support has sagged amid high inflation as his Conservative rival, Pierre Poilievre, hammered him for fueling inflation with government spending and driving up rates during a housing crisis. "The Bank of Canada's decision to maintain its overnight interest rate is welcome relief for Canadians," Finance Minister Chrystia Freeland said in a statement.

Persons: Blair Gable, Doug Porter, Andrew Kelvin, Justin Trudeau's, Pierre Poilievre, Chrystia Freeland, Steve Scherer, David Ljunggren, Fergal Smith, Ismail Shakil, Divya Rajagopal, Nivedita Balu, Mark Porter Organizations: Canada, REUTERS, Rights, Bank of Canada, Wednesday, Governing, BoC, BMO Capital Markets, Canadian, Reuters, TD Securities, Reuters Graphics Liberal, Conservative, Finance, Thomson Locations: Ottawa , Ontario, Canada

Go First has been locked in legal disputes with many of its foreign lessors since being granted bankruptcy protection in India in May. Bankruptcy froze its assets and has prohibited the recovery of more than 50 grounded Airbus (AIR.PA) planes. Go First, whose lessors also include Standard Chartered's Pembroke Aircraft Leasing, SMBC Aviation and BOC Aviation, did not respond to a request for comment. The world's second-largest aircraft lessor, SMBC, warned in May that India's decision to block leasing firms from reclaiming Go planes would jolt the market and spark a confidence crisis. Reporting by Aditi Shah and Arpan Chaturvedi in New Delhi; Editing by Simon Cameron-MooreOur Standards: The Thomson Reuters Trust Principles.

Persons: Adnan Abidi, ACG, lessors, Aditi Shah, Arpan Chaturvedi, Simon Cameron, Moore Organizations: REUTERS, Go, Airbus, Court, Reuters, ACG Aircraft Leasing, Bankruptcy, Pembroke Aircraft Leasing, SMBC Aviation, BOC Aviation, Thomson Locations: New Delhi, India, DELHI, Ireland, Delhi

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