The Bank of Canada has ended its bond-buying stimulus program and accelerated the potential timing of future interest rate increases amid worries that supply disruptions are driving up inflation.

In a statement on Wednesday, policy makers led by Governor Tiff Macklem announced they would stop growing holdings of Canadian government bonds, ending a quantitative easing program that has poured hundreds of billions into the financial system since the start of the COVID-19 pandemic.

They also signaled they could be ready to hike borrowing costs as early as April, as supply constraints limit the economy’s ability to grow without fueling inflation.

The Canadian dollar soared and bonds were hit hard. The loonie jumped to $1.2321 per U.S. dollar as of 10:39 a.m., up more than 0.5 per cent. Two-year benchmark yields rose about 20 basis points to 1.065 per cent…read more.