Interest rates staying put

The Bank of Canada is holding firm on interest rates, even though the economy is considerably weaker than it has anticipated.

Canada’s central bank has lowered its 2013 economic growth forecast

to 1.5 per cent from the previous estimate of 2 per cent. As well the bank says Canada’s economy is performing well below capacity and it will not return to full capacity until sometime in mid-2015, about six months later than it had thought in January.

The central bank says it will keep the trendsetting overnight interest rate at 1 per cent for likely some time. That was widely expected by economists and markets.