Bank of Canada holds rates again, RBC handed $7.4-million penalty and GIC party winds down: Business and investing news for December 10

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Getting caught up on a week that got away? Here’s your weekly digest of the Globe’s most essential business and investing stories, with insights and analysis from the pros, stock tips, portfolio strategies and more.

Bank of Canada holds policy interest rate steady at 5%

In a widely-expected move, the Bank of Canada held its policy interest rate steady at 5 per cent for the third time in a row on Wednesday. The central bank said that it “remains prepared to raise the policy rate further if needed,” maintaining a hawkish stance in its one-page announcement. Deputy Governor Toni Gravelle also doubled down on this hawkish message in a speech this week, saying the economy is “roughly in balance” but Canada needs to see a more sustained improvement in inflation data before ruling out further rate increases. The Bank of Canada also gave few hints that it is preparing to cut rates any time soon, Mark Rendell reports.

Canada’s anti-money-laundering agency levies largest-ever fine against RBC

Canada’s financial intelligence agency levied a $7.4-million penalty against the Royal Bank of Canada this week – the first monetary penalty it has ever imposed on any of Canada’s six biggest banks, and its largest fine ever. The Financial Transactions and Reports Analysis Centre of Canada (FinTRAC) issued the fine against RBC for non-compliance with anti-money laundering and terrorist financing measures, saying it was for administrative violations and not for criminal offences. Jameson Berkow reports that RBC will not appeal the decision.

The party is ending for GICs

Is the party over for GICs? According to Matt Lundy, the rates on Guaranteed Investment Certificates appear to have peaked – and investor interest is fading, too. Figures from the Bank of Canada suggest the most common rate for a one-year GIC posted by major chartered banks was 4.9 per cent as of Wednesday, down slightly from a recent peak of 5.1 per cent. The popular low-risk investment was even more common during the rate-hike cycle, with overall balances growing by more than $300-billion from late 2021 to March, 2023, according to data from ISS Market Intelligence. But that’s starting to change as markets widely expect the Bank of Canada to start lowering borrowing rates by the middle of next year. Take a closer look in this week’s Decoder.

Canada proposes minimum 20-23% emissions cut from oil and gas sector

Ottawa is proposing a minimum cap on emissions for the oil and gas sector, according to a policy framework released on Thursday, saying it wants Canada’s biggest polluting sector to cut emissions by 20 to 23 per cent below 2019 levels by 2030. The federal government is also proposing an upper limit emissions cap that would require facilities to pay for offsets and a decarbonization fund if they can’t cut the additional emissions directly, Emma Graney and Marieke Walsh report. The system would be imposed through a cap-and-trade system in which the initial allowances will be distributed for free.

Still bearing scars of recessions past, Windsor is on the verge of a billion-dollar revitalization

As a spectre of recession haunts Canada, one city – Windsor, Ont. – is hoping to flip the economic script. The city is now seeing an unprecedented wave of investment, but was once considered a consistent bellwether for trouble in the Canadian economy. The Conference Board of Canada said this week it expects Windsor’s economy to grow 2.4 per cent this year and 1.7 per cent next year, giving it the strongest growth outlook of Canada’s 24 largest cities. Jason Kirby spoke with people from across the economic spectrum – small business owners, housing advocates, property developers, union leaders, newcomers and more – to capture the full sweep of what’s going on in Windsor.

Young Canadians’ biggest money questions, answered by our personal finance columnist

Is this the time to save? Is housing going to become more affordable? How do you start building an emergency fund – and how much should be in it? In a recent episode of The Decibel, Rob Carrick answered the most pressing questions affecting young Canadians and his tips for helping young people navigate today’s financial world.

Now that you’re all caught up, test your knowledge with our weekly business and investing news quiz and prepare for the week ahead with the Globe’s investing calendar.