Bank of Canada's QT program, reducing settlement balances, is expected to end by 2025, followed by resuming normal market operations.

Bank of Canada Deputy Governor Toni Gravelle has announced that the central bank's quantitative tightening (QT) program, which involves shrinking its balance sheet, is expected to conclude by 2025. QT has been reducing settlement balances held by financial institutions to around $100 billion. Once the process ends and settlement balances fall to a range of $20-60 billion, the Bank of Canada plans to resume its normal market operations, such as purchasing financial assets to reflect growth in cash circulating within the economy.

March 21, 2024
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