Notizie economiche
04.09.2024

BoC lowers its benchmark interest rate to 4.25%, as widely expected

The Bank of Canada (BoC) lowered its benchmark interest rate by 25 basis points to 4.25 per cent on Wednesday, as widely expected. This represented the third straight decrease in the BoC’s key interest rate.

In its policy statement, the Canadian central bank noted:

- Canada’s 2.1% economic growth in the second quarter was slightly stronger than the BoC forecast in July, but preliminary indicators suggest that economic activity was soft through June and July;

- Domestic labour market continues to slow, but wage growth remains elevated relative to productivity;

- Inflation slowed further to 2.5% in July, as expected;

- High shelter price inflation is still the biggest contributor to total inflation but is starting to slow. Inflation also remains elevated in some other services;

- With continued easing in broad inflationary pressures, Governing Council decided to reduce its policy rate by a further 25 basis points;

- Excess supply in economy continues to put downward pressure on inflation, while price increases in shelter and some other services are holding inflation up. Governing Council is carefully assessing these opposing forces on inflation.

- Monetary policy decisions will be guided by incoming information and the policymakers’ assessment of their implications for the inflation outlook;

- BoC remains resolute in its commitment to restoring price stability

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