Canada raises interest rate

Added On July 13, 2018

The Bank of Canada has announced that it is raising interest rates to 1.5 percent, partly due to rising trade tensions with the United States.

Explaining the increase, the Bank of Canada said it had underestimated the mounting global trade turmoil.
It added that, quote: 
"The possibility of more trade protectionism is the most important threat to global prospects."
The United States is currently pressuring Canada and Mexico for more favorable trade terms, in renegotiations of the North American Free Trade Agreement.
Earlier this year, Washington slapped a 25-percent tariff on steel imports and 10-percent tariff on aluminum imports, with Canada among the major targets.
It has also threatened to impose higher duties on the car industry.
The Bank of Canada said it will continue to use higher interest rates to keep inflation on target.
After years of record lows in Canada, rates have now been raised four times since summer.