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Bank of Canada holds interest rate warns of drag from global trade

OTTAWA — The Bank of Canada is leaving its key interest rate unchanged in an announcement that balances domestic economic improvements with an expanding global slowdown caused by trade conflicts.The decision keeps the interest rate at 1.75 per cent for a sixth-straight meeting — and governor Stephen Poloz appears to be in no rush to make a move even as policy-makers in the U.S. and Europe signal they may introduce cuts.The central bank is also releasing updated projections for Canada that predict annualized economic growth this year of 1.3 per cent, up slightly from its April forecast of 1.2 per cent, and an expansion of 1.9 per cent in 2020, down from its previous call of 2.1 per cent.Canada has had a stronger-than-expected rebound from a slowdown that nearly brought the economy to halt in late 2018 and early of 2019.In a statement, the bank says the unexpectedly robust bounce back in the second quarter was due to temporary factors, such as a recovery from weather-related weaknesses and a boost in oil production.The bank is now projecting second-quarter growth at an annual pace of 2.3 per cent, up from its April call of 1.3 per cent.The Canadian Press

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