The Bank of Canada cut its key rate by 25 basis points to 4.25% on Wednesday, marking its third consecutive rate reduction due to easing inflationary pressures.
Key Rate Cut
The Bank of Canada (BoC) lowered its key policy rate by 25 basis points to 4.25% on Wednesday. This decision is the third straight rate cut, driven by easing inflationary pressures, as Canada's inflation rate fell to a 40-month low of 2.5% in July.
Current Inflation in Canada
Despite the decline, inflation remains above the central bank’s 2% target. The BoC forecasts an annualized inflation rate of 2.8%.
US Labor Market
US job vacancies in July dropped to 7.673 million, marking the lowest level since early 2021 and missing market forecasts.
The Bank of Canada's rate cut underscores ongoing efforts to combat inflation amid easing economic pressures. The US labor market situation also remains tense, requiring further monitoring.
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