Bank of Canada expected to raise rates next week, some economists say

The Bank of Canada has held its key interest rate unchanged for about a year, but some economists expect rates to begin increasing again as early as next week — which would be the first hike in more than three years.

This comes after a recent warning from the central bank that inflation is expected to keep rising as a ripple effect of the Iran war and other factors.

Last month, the U.S. Federal Reserve hiked its key policy rate for the first time in three years, and after U.S. inflation in August topped 3.4 per cent.

Tamping down red-hot inflation is key to making life more affordable for Canadians amid the heightened cost of living — along with increasing wages and salaries — but in order to achieve this, it may mean some will end up paying more to borrow money.