The Bank of Canada continued its efforts to fight rising inflation, raising interest rates by half a percent on Wednesday. The bank also stated it will begin quantitative tightening starting on April 25, which will effectively make fixed rate mortgages more expensive.
The interest rate increase was expected as the bank attempts to counter an inflation rate of 5.7%. More increases are likely in the months ahead.
"Russia’s ongoing invasion of Ukraine is causing unimaginable human suffering and new economic uncertainty," stated a Bank of Canada media release. "Price spikes in oil, natural gas and other commodities are adding to inflation around the world. Supply disruptions resulting from the war are also exacerbating ongoing supply constraints and weighing on activity. These factors are the primary drivers of a substantial upward revision to the Bank’s outlook for inflation in Canada."