Bank Of Canada Raises Interest Rates By 75 Basis Points, Indicates Further Rate Hikes

(RTTNews) - The Bank of Canada on Wednesday announced its widely expected decision to increase policy interest rates by 75 basis points.

The Canadian central bank raised its target for the overnight rate to 3.25 percent, with the Bank Rate at 3.50 percent and the deposit rate at 3.25 percent. The bank also said it is continuing its policy of quantitative tightening.

The 75 basis point rate hike marks the fifth straight increase in interest rates by the Bank of Canada and follows a 100 basis point rate hike in July.

Citing the outlook for inflation, the Bank of Canada also said it still believes further interest rates will be needed.

"As the effects of tighter monetary policy work through the economy, we will be assessing how much higher interest rates need to go to return inflation to target," the Bank of Canada said.

The bank added, "The Governing Council remains resolute in its commitment to price stability and will continue to take action as required to achieve the 2% inflation target."