BOC announces discontinuation of Covid relief actions

  • BOC announces discontinuation of market functioning programs introduced during Covid 19 crisis
  • THe commercial paper purchase program (CPPP), the provincial bond purchase program (PBPP) and corporate bond purchase program (CBPP) will discontinue on their originally announced and 8
  • THe CPPP will discontinue effective April 2. The PBPP will discontinue effective May 7. The CBPP will discontinue effective May 26
  • It does not currently plan to sell any of the securities acquired under these programs
  • term repo operations will be suspended effective May 10
  • continued term repo facility will be deactivated effective April 6

BOC Grancelle adds:

  • THe governing Council is evaluating how the process of adjusting ongoing purchases of GOC bonds could unfold
  • adjusting the pace of QE purchases won't necessarily mean that we have changed our views about when we will need to start raising the policy interest rate
  • eventually we will reach a point where the outcomes outlined in our forward guidance have been achieved, then we will need to start raising our policy rate to achieve our inflation objective
  • we will review extraordinary actions taken in response to pandemic to assess whether they were calibrated ideally; whether we could do anything differently in future episodes of market stress
  • We are looking at whether any further structural reforms could be made to improve financial system resilient and minimize the likelihood that extraordinary tools will be needed in the future
  • we expect our balance sheet decline to about C$475 billion by the end of April