The Bank of Canada has raised its key interest rate a quarter point to five per cent. Bank of Canada Governor Tiff Macklem says global inflation has eased but robust demand and tight labour markets are still causing persistent inflationary pressures in services. He adds that the Bank expects consumer spending to slow in response to the recent increases in interest rates, but recent retail trade and other data suggests this is still a persistent excess demand in the economy.

New projections indicate it will take until mid-2025 to get inflation back to two per cent. The next scheduled date for an interest rate announcement is September 6th.