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Assume the current operating band of the overnight loan rate is from 3.5 - 4.0% and the current overnight loan rate is at the mid-point
Assume the current operating band of the overnight loan rate is from 3.5 - 4.0% and the current overnight loan rate is at the mid-point of the range. Now assume that the Bank of Canada is expressing concerns about rising inflationary pressures and that the next meeting of the Bank of Canada to decide on any change in interest rates is scheduled for today. What decision would you expect to see the Bank of Canada arrive at with respect to the target OLR and the operating band? Explain.
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