policymakers led by governor tiff macklem increased the overnight benchmark interest to 05 at a decision wednesday in ottawa in a widely expected move officials also said they expect to raise borrowing costs by more because of elevated inflation pressures but refrained from starting a run off of their government bond holdings  the rate move is the first increase in borrowing costs since 2018 and the start of what some are anticipating will be one of the fastest hiking cycles since the central bank adopted an inflation target three decades ago markets are betting the bank of canadas overnight policy rate will hit as high as 1 by june and 175 by this time next year