Ottawa, Oct 24 (IANS): Canada's central bank, the Bank of Canada, has announced that it is maintaining the current overnight interest rate at 1 percent.

This is the 17th consecutive time that the bank kept the rate unchanged, reported Xinhua.

As for the Canadian economy, the bank warned Tuesday that the household debt burden is expected to rise further before stabilizing in a few years. It also expected housing activity to decline from historically high levels.

The bank said it will consider the imbalances in the household sector in its future monetary decisions.

The bank predicted exports to pick up gradually but remain below their pre-recession peak until the first half of 2014. It regarded the persistent strength of the Canadian dollar, which is influenced by safe haven flows and spillovers from global monetary policy, as one of the main challenges.

According to the bank, the economic expansion in Canada continues to be driven mainly by growth in consumption and business investment, and the economy is expected to pick up and return to full capacity by the end of 2013.

The Canadian economy is projected to grow by 2.2 percent in 2012, 2.3 percent in 2013 and 2.4 percent in 2014, different from the views of many private sector economists, who have lowered the growth expectations for this year to below 2 percent.

Inflation expectations stay well-anchored, said the bank, which projected core inflation to reach 2 percent by mid 2013, and total CPI (consumer price index) to return to 2 percent by the end of that year.