A panel of leading economists has called for a significant hike in interest rates when the Bank of Canada meets next week.

Members of the C. D. Howe Institute's monetary policy council say the central bank should boost rates by half a percentage point, to choke off emerging signs of inflation in the economy. The rate currently stands at 2.0 per cent.

The central bank meets Wednesday to consider its next move on interest rates.

Five members of the panel suggested a hike of half a point, while four urged a more modest increase of one-quarter of a point. One member called for a three-quarter point increase next week, and no increase in October.

The Bank of Canada has cut rates three times this year. The last rate increase was in April, 2003.