Bank of Canada considered raising interest rates at its last meeting

The Bank of Canada considered raising interest rates earlier this month, as it feared being too slow to react to sticky inflation.

In its summary of deliberations released Wednesday, the central bank says its governing council contemplated another rate hike. The main arguments in favour of another rate hike were resilience in economic growth, potential challenges bringing inflation down from three to two per cent and the risk of waiting too long to respond to stubborn inflation.

While the central bank appears confident that inflation will fall to three per cent by mid-year, it remains concerned that the return to two per cent inflation may take longer as the cost of services remains elevated.

Ultimately, the Bank of Canada maintained its key interest rate at 4.5 per cent on April 12 and decided in favour of waiting for more economic data to determine whether rates need to rise further.