Canada column for Sunday, Oct. 28/12
THE CANADIAN REPORT
(c) By Jim Fox
Canada’s dollar has dropped to just above parity with the U.S. currency after the country’s central bank said plans to raise interest rates are now “less imminent.”
Bank of Canada, Mark Carney made the comment while cautioning that lagging global demand and high household debts are concerns to the country’s economic outlook.
The bank kept its trendsetting interest rate at 1 percent and expectations are it might not be increased for at least another year.
"Because of global headwinds, there is a need to provide very stimulative monetary policy," Carney said.
“The case for adjustment of interest rates has become less imminent . . . but over time, rates are more likely to go up than not,” he added.
The dollar is at a two-month low, down about two cents, and was also shaken by the Canadian government’s decision to block an oil-field takeover bid as being not in the national interests.
Petronas, Malaysia’s government-run energy company, was rebuffed in its $5.2-billion proposed deal to take over Progress Energy Resources Corp. a Calgary-based natural gas business.