The Bank of Canada has increased its key interest rate for the first time since March 2020.
The key interest rate will go from 0.25 per cent to 0.5 per cent.
It comes as economies are rebounding from the impact of the COVID-19 Omicron variant more quickly than expected.
“Although the virus continues to circulate and the possibility of new variants remains a concern. Demand is robust, particularly in the United States. Global supply bottlenecks remain challenging, although there are indications that some constraints have eased,” reads the Bank of Canada statement.
Inflation is currently at 5.1 per cent and remains well above the Bank’s target range.
The Bank notes the unprovoked invasion of Ukraine by Russia have forced prices for oil and other commodities higher, which will add to inflation around the world.
