C.D. Howe Institute's Monetary Policy Council Calls for Bank of Canada to
Maintain Overnight Rate at 0.25 Percent, With Increase to 1.00 Percent in
2010

TORONTO , Dec. 3 /CNW/ - The C.D. Howe Institute's Monetary Policy Council (MPC) (http://www.cdhowe.org/display.cfm?page=monetarySynopsis) today recommended that the Bank of Canada hold its target for the overnight interest rate at 0.25 percent at its next announcement on December 8, 2009 . The Council further recommended that the Bank keep the target at 0.25 percent at the Bank's subsequent announcement in January, in keeping with the Bank of Canada's conditional commitment to do so into 2010, and raise it thereafter, with the group's median call being for a target of 1.00 percent in the second half of 2010. The overnight rate is a very short-term money-market rate that the central bank targets for monetary policy purposes.

The MPC is a panel sponsored by the C.D. Howe Institute to provide an independent assessment of the monetary stance most appropriate for the Bank of Canada as it seeks to achieve its 2 percent inflation target. William Robson (http://www.cdhowe.org/display.cfm?page=WilliamB.P.%20Robson), the Institute's President and CEO, chairs the Council.

For the full recommendation go to: www.cdhowe.org

For further information: Kristine Gray - phone: [phone]; e-mail: [email protected]