This morning, the Bank of Canada announced it was holding its overnight rate at 4.5%. It’s the second month in a row the rate has stayed the same after rising eight times since March 2022. The move suggests the bank is seeing the impact of higher interest rates reflected in cooling inflation. The bank is now forecasting inflation to drop to 3% by mid-year and slowly fall to the target rate of 2% by the end of next year.

“Inflation in many countries is easing in the face of lower energy prices, normalizing global supply chains and tighter monetary policy,” stated the bank’s news release. “At the same time, labour markets remain tight and measures of core inflation in many advanced economies suggest persistent price pressures, especially for services.”

The bank will make its next rate announcement on June 7, followed by the release of its latest Economic Progress Report on June 8 in Victoria at an event hosted by The Chamber. See below for more information on this special Business Leaders Luncheon, sponsored by Odlum Brown.

• Plan a brunch with family or friends
• Buy a spring bouquet from a local florist
• Make an Easter basket filled with delicious treats
• Host an Easter Egg hunt in a local park
• Make a fun snack — Devilled Eggs and Carrot Cake Muffins perhaps?

 
Whatever your Easter traditions may be, we hope you have a hoppy day while buying Easter supplies locally and sustainably!
 
The Chamber will be closed on Good Friday, April 7, and Easter Monday, April 10.
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Yesterday’s budget committed the government to about $43 billion in new spending over six years, said Canadian Chamber Chief Economist Stephen Tapp.

“While there are many ways to break down these moves, I ‘follow the money’ to identify five big-ticket categories,” Tapp said, pointing to $31 billion for health care, $16 billion for tax credits aimed at spurring investment in a clean economy, and about $25 billion for benefit cheques and other new spending. Tapp also noted that new taxes to high-earners will raise about $14 billion while spending cuts will save another $13 billion.

The Greater Victoria Chamber of Commerce has advocated for infrastructure projects in our region, including modernization of Belleville Terminal. It’s not clear yet if there is money in this budget for that.

“On the one hand, The Chamber is a huge proponent of shifting to a green economy and the opportunities that represents for our members. This budget will offer encouragement to chamber members at the leading edge of this shift,” Chamber CEO Bruce Williams said, adding that another positive highlight was a promise to lower credit card transaction fees for small businesses. The government says 90% of businesses that take credit cards will see fees go down by 27%.

Still to be determined is how government spending $2.5 billion on relief cheques for lower-income Canadians will affect inflation.

“On the one hand, businesses will be happy customers have a little more money to spend but will it mean costs keep going up? Time will tell,” Williams said.
“The rising cost of doing business is a major concern. Food prices are up, and life is getting more expensive for everyone. Inflation is a problem and higher interest rates have increased the cost of borrowing money, which reduces business investment.”