Ottawa, Apr 13 (IANS): The Bank of Canada has held its target for the benchmark interest rate at 4.5 per cent.

In a statement on Wednesday, the central bank said that its governing council continues to assess whether monetary policy is sufficiently restrictive to relieve price pressures and remains prepared to raise the policy rate further if needed to return inflation to the 2 percent target, Xinhua news agency.

The bank said it is also continuing its policy of quantitative tightening to complement its restrictive stance.

According to the bank, Canada's CPI inflation eased to 5.2 per cent in February and its preferred measures of core inflation were just under 5 per cent.

The Bank of Canada said it expects CPI inflation to fall quickly to around 3 per cent in the middle of this year and then decline more gradually to the 2 per cent target by the end of 2024.

However, getting inflation the rest of the way back to 2 per cent could prove to be more difficult because inflation expectations are coming down slowly, service price inflation and wage growth remain elevated, and corporate pricing behaviour has yet to normalise, the bank said.

Economic growth in the first quarter looks to be stronger than was projected in January, with a bounce in exports and solid consumption growth. It is projected to be weak through the remainder of this year before strengthening gradually next year, it added.

According to the central bank, Canada's economy is projected to grow by 1.4 per cent this year and 1.3 per cent in 2024 before picking up to 2.5 per cent in 2025.