The Canadian stock market experienced high volatility on Wednesday after the Bank of Canada (BoC) held the key interest rates steady but warned “that further declines in inflation are likely to be gradual and uneven.” In intraday trading, The S&P/TSX Composite Index rallied as much as 127 points to its highest level in over 20 months. However, the index gave up these gains later during the session to settle at 21,026 — nine points lower from its previous closing.
While a sharp recovery in oil and gas prices drove energy stocks higher, big losses in most other market sectors, including healthcare, mining, and real estate, weighed on the TSX benchmark.
In his opening statement on January 24, BoC governor Tiff Macklem also highlighted that the central bank projects modest economic growth in 2024, with inflation expected to ease to about 2.5% by year-end and return to the 2% target in 2025.
