Financial News: Bank Of Canada Lowers Interest Rates By Another

Bank Of Canada Lowers Interest Rates By Another Quarter Point

07/24/2024 - 09:56:00 (RTTNews)

(RTTNews) - In a widely expected move, the Bank of Canada on Wednesday announced its decision to lower interest rates by another quarter point.

The Bank of Canada said it has reduced its target for the overnight rate by 25 basis points to 4.5 percent, with the bank rate at 4.75 percent and the deposit rate at 4.5 percent.

The Canadian central bank said the decision to lower rates for the second straight meeting came as broad price pressures continue to ease and inflation is expected to move closer to 2 percent.

With ongoing excess supply lowering inflationary pressures, the Bank of Canada said its preferred measures of core inflation are expected to slow to about 2.5 percent in the second half of 2024 and ease gradually through 2025.

The Bank of Canada also said consumer price inflation is expected to come down below core inflation in the second half of this year, largely because of base year effects on gasoline prices.

At the same time, the Canadian central bank noted price pressures in some important parts of the economy-notably shelter and some other services-are holding inflation up.

The Bank of Canada said its Governing Council is carefully assessing these opposing forces on inflation and noted future monetary policy decisions will be guided by incoming information and their assessment of their implications for the inflation outlook.

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