The Bank of Canada is maintaining interest rates as the economy navigates a temporary economic slowdown due to the sharp drop in oil prices. This recent drop will lower total revenue for the Canadian economy due to the inelastic coefficient of crude oil, which will adversely impact the elasticity of supply despite the positive effect on the price elasticity of demand. On top of that, the drop in oil prices will also affect wages, as Canada’s sharp deceleration in wage growth has also been highlighted as a concern for the economy. The bank says the national wage-growth figures have been weighed down by weaker numbers in the oil-producing provinces. However, overall, the central bank has a positive outlook for Canada’s future economic growth: “As the snow melts, we’ll have a clearer view that the economy is back on track and then likely to grow above or around 2% after that,” Bank of Canada governor Stephen Poloz told reporters after announcing the bank would keep its interest rate at 1.75%.