Statistics Canada inflation rate reports

Bank of Canada Cuts Interest Rate by Quarter Percentage Point to 4.25% for Third Time Since June

Sep 4, 2024, 01:47 PM

The Bank of Canada has announced a third consecutive interest rate cut, lowering its key policy rate by a quarter percentage point to 4.25%. This move, which aligns with economists' expectations, aims to bolster economic growth amid weakening economic conditions and decelerating inflation. Governor Tiff Macklem indicated that further rate cuts could be expected if inflation continues to ease in line with the central bank's July forecast. The decision comes as the Canadian economy faces rising unemployment, home defaults, and broad economic distress. Despite high shelter price inflation, overall inflationary pressures are easing, prompting the central bank to take action to prevent the economy from weakening further. This marks the third cut since June, with the central bank focused on ensuring inflation does not undershoot the 2% target.