Interest Rates Bank of Canada cuts 50 points

Posted on Mark Argentino
22.04.2008
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Bank of Canada Slashes Interest Rate Again!

This could be the final cut for some time to come as the Bank of Canada cuts another 50 points off the key rate

In a widely expected move, the Bank of Canada cut its key interest rate by 50 basis points, or half a percentage point, on Tuesday? The cut brings the key rate to just 3 per cent.

The latest reduction brings the number of consecutive cuts to four since last summer, totalling 150 basis points, as the central bank attempts to deliver some stimulus to the slowing economy?

Inflation, however, does not appear to be a big concern thanks largely to the offsetting impact of the strong Canadian dollar. In the latest report from Statistics Canada, year-over-year inflation as measure by the consumer price index rose just 1.4 per cent in March, well within the central bank’s target. The bank believe inflation will rise to about 2 per cent by 2010

In its accompanying statement, the Bank of Canada noted that the economic slowdown in the United States is expected to be deeper and more protracted, causing the Canadian economy to expand at a 1.4 per cent pace.

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