Bank of Canada says it will cut rates further if economy meets forecasts
2024.10.29 16:14
OTTAWA (Reuters) -The Bank of Canada will be able to cut interest rates again to support demand and keep inflation on target if the economy evolves broadly in line with forecasts, Governor Tiff Macklem said on Tuesday.
The central bank last week cut its key benchmark rate by 50 basis points to 3.75%, its first bigger-than-usual move in more than four years, and hailed signs the country had returned to an era of low inflation.
“If the economy evolves broadly in line with our forecast, we anticipate cutting our policy rate further to support demand and keep inflation on target,” Macklem said in opening remarks to the House of Commons finance committee.
The central bank, which hiked rates to a 20-year high to fight soaring prices, has now cut four times in a row since June. Inflation in September sank to 1.6%, below the 2% target.
“We want to see growth strengthen. Last week’s interest rate decision should contribute to a pickup in demand,” Macklem said.
