In an announcement this morning, The Bank of Canada reduced its target for the overnight rate to 4¾%, with the Bank Rate holding steady at 5% and the deposit rate at 4¾%.
Higher interest rates purportedly need more time to have more time to impact the economy and address inflation, which, although easing, still poses a risk of stalling above the bank’s 2% target. Although there is underlying evidence that overall inflation is decreasing – it may be too soon to tell whether that could be sustained with a large reduction in rates.
The Bank is expected to make it’s next announcement regarding the rates in late July.
Written by: B. Shakyaver