UPDATE 3-Bank of Canada drops rate-hike talk, sees slower growth
* Omits rate-hike mention for first time since April 2012
* Sees rising risk from persistently weak inflation
* Sees delay in inflation returning to 2 percent target
* Downgrades growth projections across the board
* C$ sinks on news, fixed-income market rallies
By Louise Egan and Randall Palmer
OTTAWA, Oct 23 (Reuters) - The Bank of Canada has abandoned 18 months of warnings that interest rates will one day have to rise, saying on Wednesday that a soft economy and persistently weak inflation mean there is as much chance of a rate cut as a rate hike.
The surprise policy shift, which knocked the Canadian dollar to a one-week low and sent bond prices higher, came in a statement in which the central bank kept its key rate at 1.0 percent and dropped any hint of an eventual rate increase. Continued...