Little circulation: Pedestrians walking past the central bank office in Ottawa. Gravelle says firms may have been reluctant to part with the settlement balances because of uncertainty and worries about precautionary motives. — Reuters
OTTAWA: A Bank of Canada official says a recent change in how the central bank sets its deposit rate is working to improve the functioning of money markets, lowering borrowing costs.
Central bank policymakers said on Jan 29 they would start setting the deposit rate at five basis points below the central bank’s policy interest rate. Previously, the two rates were set at the same level.
