Bank of Canada keeps key interest rate target at 0.25%, early data shows economy plunged

The central bank says the downturn tied to COVID-19 will be the worst on record

The Bank of Canada is keeping its key interest rate target on hold at 0.25 per cent, saying this morning that it is effectively as low as it can go to combat the economic impacts of COVID-19.

The central bank says the downturn tied to COVID-19 will be the worst on record. Preliminary data from Statistics Canada today showed economic activity collapsed in March as it dropped a record nine per cent.

The pandemic has forced companies to close and workers to stay at home as much as possible in a massive public health effort to slow the spread of COVID-19, leading to steep and sudden drops in business activity and consumer spending.

The central bank’s economic outlook also released this morning says the speed of the anticipated rebound rests on the shoulders of containment efforts to bring the pandemic under control.

If conditions improve quickly, the economic shock is likely to be “abrupt and deep but relatively short-lived” and followed by a strong rebound for most, but not all, sectors of the economy.

A more severe scenario would likely see a “significant number” of businesses closing for good and longer spells of unemployment as workers look for new jobs.

READ MORE: More older Canadians die as COVID-19 toll passes 800; economy could shrink 6.2%

READ MORE: March job losses just ‘a tiny snapshot’ of full impact of COVID-19

The Canadian Press


Like us on Facebook and follow us on Twitter.

Coronaviruseconomy

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

Seafest parade sails on June 27

Tides are turning during COVID-19 for Prince Rupert parade

SD 52 fires superintendent

Dr. Irene LaPierre removed from position immediately.

B.C. government eyes antlerless moose harvest increase in bid to save caribou

Antlerless moose hunts reduce predation for threatened mountain caribou, says ministry

Necropsy for Port Edward wolf is scheduled

Wolf sightings in Prince Rupert have increased

Wolf killed in Port Edward

Samples to be sent to lab. for testing

If Trudeau won’t stand up to Trump, how will regular people: Singh

Trudeau did not directly answer a question about Trump’s actions amid protests

VIDEO: Internal investigation into aggressive arrest by Kelowna Mountie

A video allegedly shows a Kelowna Mountie striking a man several times

22 new COVID-19 test-positives, one death following days of low case counts in B.C.

Health officials urged British Columbians to ‘stand together while staying apart’

John Horgan says COVID-19 restrictions won’t be eased regionally

B.C. Liberals urge ‘tailored’ response based on infections

Feds get failing grade for lack of action plan on anniversary of MMIWG report

‘Instead of a National Action Plan, we have been left with a Lack-of-Action Plan’

Introducing the West Coast Traveller: A voyage of the mind

Top armchair travel content for Alaska, Yukon, BC, Alberta, Washington, Oregon and California!

B.C. ranchers, lodge operators say Indigenous land title shuts them out

Tsilhqot’in jurisdiction affects grazing, access to private property

As two B.C. offices see outbreaks, Dr. Henry warns tests don’t replace other measures

Physical distancing, PPE and sanitizing remain key to reduce COVID-19 spread

Greater Victoria drive-thru window smashed after man receives burger without mustard

Greater Victoria Wendy’s staff call police after man allegedly rips Plexiglas barrier off window

Most Read