C.D. Howe Institute's Monetary Policy Council Urges Bank of Canada to Raise
Overnight Rate to 1.00 Percent, With Increases to 1.50 in March and 2.25
Percent by September 2011

TORONTO, Sept. 2 /CNW/ - The C.D. Howe Institute's Monetary Policy Council (MPC) today recommended that the Bank of Canada raise its target for the overnight interest rate (the very short-term money-market rate the Bank targets for monetary policy purposes) to 1.00 percent at its next announcement on September 8, 2010. The Council recommended maintaining the target rate at 1.00 percent at the following announcement on October 19, 2010, followed by increases that would take it to 1.50 percent in March 2011 and 2.25 percent in September 2011.

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, the Institute's President and CEO, chairs the Council.

For the full report go to www.cdhowe.org.com

For further information:

Kristine Gray - phone: [phone]; e-mail: [email protected].