The target for the overnight rate

The Bank carries out monetary policy by influencing short-term interest rates. It does this by raising and lowering the target for the overnight rate.

The overnight rate is the interest rate at which major financial institutions borrow and lend one-day (or "overnight") funds among themselves; the Bank sets a target level for that rate. This target for the overnight rate is often referred to as the Bank's key interest rate or key policy rate.

Changes in the target for the overnight rate influence other interest rates, such as those for consumer loans and mortgages. They can also affect the exchange rate of the Canadian dollar.

In November 2000, the Bank introduced a system of eight "fixed" dates each year on which it announces whether or not it will change the key policy rate

 

Date

Target (%)

Change (%)

4 June 2009

0.25

---

21 April 2009

0.25

- 0.25

3 March 2009

0.50

- 0.50

20 January 2009

1.00

- 0.50

9 December 2008

1.50

- 0.75

21 October 2008

2.25

- 0.25

8 October 2008

2.50

- 0.50

15 July 2008

3.00

---

10 June 2008

3.00

---

22 April 2008

3.00

- 0.50

4 March 2008

3.50

- 0.50

I hope you find this information useful.  Thanks for stopping by.

Constantine Isslamow

Broker/Manager

Copyright © 1995 - 2009, Bank of Canada.

Constantine Isslamow

Constantine Isslamow

Broker of Record
CENTURY 21 United Realty Inc., Brokerage*
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