By Kim Mackrael
OTTAWA--The Canadian economy is beginning its recovery from the worst impacts of the coronavirus pandemic, but that process will be gradual and uneven, a senior Bank of Canada official said.
Deputy Governor Lawrence Schembri said in a virtual speech on Thursday that recent economic data suggest the country's economic recovery has already begun. The recovery will be characterized by two phases: a rapid bounceback as economic restrictions are lifted, followed by a longer-lasting period of recuperation, he said.
"The uncertainty around this recuperation stage is extraordinary and points toward a recovery that will be gradual and long-lasting," Mr. Schembri said in prepared remarks.
Households are likely to remain cautious in their spending as they adjust to longer-term changes caused by the pandemic, he said, including ongoing concerns about transmission.
The Bank of Canada cut its benchmark overnight interest rate three times in March, bringing it to the current level of 0.25%, which the central bank considers the lowest effective rate. It also launched large-scale asset purchases, also known as quantitative easing, to ease strains in funding markets.
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