The Bank of Canada (BoC) left its benchmark interest rates unchanged at 0.25 percent on Wednesday, as widely expected.

In its policy statement, the Canadian central bank also unveiled new measures to provide additional support to Canada's financial system. In particular, the Bank:

• will continue to purchase at least $5 billion in Government of Canada securities per week in the secondary market, and will increase the level of purchases as required to maintain proper functioning of the government bond market;
• is temporarily increasing the amount of Treasury Bills it acquires at auctions to up to 40 percent, effective immediately;
• is also announcing the development of a new Provincial Bond Purchase Program of up to $50 billion, to supplement its Provincial Money Market Purchase Program, and announcing a new Corporate Bond Purchase Program, in which the Bank will acquire up to a total of $10 billion in investment-grade corporate bonds in the secondary market. Both of these programs will be put in place in the coming weeks;
• is further enhancing its term repo facility to permit funding for up to 24 months

It was also noted that the BoC's Governing Council is ready to adjust the scale or duration of its programs if necessary.

The Bank sees the level of real activity was down 1-3 percent in the first quarter of 2020, and will be 15-30 percent lower in the second quarter than in fourth-quarter 2019. CPI inflation is seen to be close to 0 percent in the second quarter of 2020.