–BoC will Also Release Policy Decision at 0945 ET, 15 Minutes Earlier Than Now
By Max Sato
(MaceNews) – As part of its efforts to beef up communications with the public and markets, the Bank of Canada on Friday said it is doubling the frequency of the post-rate announcement news conference by its governor to eight times a year, effective Jan. 24, 2024.
Every scheduled interest rate announcement will be followed by a press conference with the governor and senior deputy governor at 1030 ET, and all scheduled interest rate announcements will take place at 0945 ET, 15 minutes earlier than at present, the bank said.
“This change (in release time) is aimed at improving market functioning by removing a conflict with the North American timing of foreign exchange option expiry,” it said.
The text of the governor’s opening statement will be published along with the interest-rate announcement at 0945 ET, it added.
Currently the Boc leaders meet reporters at 1100 ET after the bank releases Governing Council’s policy decision at 1000 ET, in January, April, July and October, when the bank also releases the quarterly Monetary Policy Report to provide its latest economic projections and risk analysis.
To increase the transparency of its decision-making process, the bank in early 2023 began publishing the “summary of deliberations” of the Governing Council that lead to monetary policy decisions.
At a news conference on Friday after giving a speech on “the path to price stability,” Governor Tiff Macklem was asked about the costs and benefits of releasing interest rate forecasts by council members in the future (the Boc does not provide such information). He replied that the bank provides a “fair amount information” about issues and perspectives brought by different council members in the summary.
“We do discuss where interest rates might need to go in the future, but that’s something we need to decide on at the meeting,” Macklem said. “We are not trying to achieve the consensus on that. What we have to achieve the consensus on is the decision at hand.”
“We provide as much guidance as to where interest rates might be going as we feel we can comfortably provide,” he said.
The current policy stance is that the bank decided to hold rates steady for a third consecutive meeting in December after tightening rapidly last year, the governor said, adding, “We are taking one meeting at a time and I think you just have to take it at face value. That’s how we are explaining it to you.”
In line with the change to the policy announcement release time, the deadline for the bank’s Securities Repo Operation (SRO) will move to 1015 ET from 1000 ET, and the timing for the release of the Call for Tenders will change to 15 minutes before the deadline, from its current 30 minutes before the deadline, the BoC said. These changes will take effect on Dec. 18, 2023.
The SRO’s current maximum bid rate will remain at 15 basis points below target and there are no other changes to the SRO, the bank said.