Central Banks
BOC Delivers Another Jumbo Rate Cut But Signals Easing to Slow
- Bank removed explicit reference to expectations of more cuts
- Officials set to evaluate reductions ‘one decision at a time’
Bank of Canada Governor Tiff Macklem.
Photographer: David Kawai/BloombergThis article is for subscribers only.
After quickly chopping interest rates down from the highest levels in two decades, the Bank of Canada is pivoting to a more gradual pace of adjustments — pushing back on expectations of a rush to cheaper borrowing costs.
On Wednesday, officials cut the benchmark overnight rate by 50 basis points to 3.25%, bringing the tally to 175 basis points of easing in a little over half a year. But in their statement, the bank removed an explicit reference that they were expecting to reduce the policy rate further, replacing that with wording that suggested they’d evaluate “the need for further reductions in the policy rate one decision at a time.”