Weak economic growth around the world and specifically in the European Union will keep the Bank of Canada from raising interest rates until 2013. At the same time, we do not see a rate cut happening in 2012.

The Bank of Canada's target for the overnight rate has now been at one percent for more than a year.

Some recent Canadian economic data, such as business confidence and employment growth, has been deteriorating. Monthly employment statistics have shown that Canada has missed its forecast, which will give the Bank of Canada less reason to tighten monetary policy before the Unites States Federal Reserve.

The Fed has already said it expects to keep its key interest rate near zero through mid-2013.

At the same time, a cut in the overnight interest rate in 2012 is very unlikely. It would take a severe global recession, which is a low probability event, before the Bank of Canada would consider lowering rates.

The Bank of Canada has scheduled its future interest rate announcement for 2012 as follows: March 8th, April 17th, June 5th, July 17th, September 5th, October 23rd, and December 4th.

Comments on the Bank of Canada announcement provided by Tony Demarin, B. Comm. (Hons), MBA, CFA, CIM, FCSI, President BCV Asset Management Inc.