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Bank of Canada Cuts Key Interest Rate Amid Trade War
BY Connect Newsroom, Mar 12, 2025 5:20 PM - REPORT AN ERROR
Governor Tiff Macklem stated that the economy had started the year strong, with solid GDP growth and inflation around two percent.
On Wednesday, the Bank of Canada reduced its key policy rate by 25 basis points to 2.75 percent, marking the seventh consecutive interest rate cut. This decision comes in response to the ongoing trade war between Canada and the United States.
Governor Tiff Macklem stated that the economy had started the year strong, with solid GDP growth and inflation around two percent. However, tariff uncertainty has impacted business spending and consumer confidence, prompting the central bank to lower the interest rate by a quarter of a percentage point.
Macklem also emphasized that the bank will proceed with caution regarding any further interest rate changes, as it continues to evaluate the effects of tariffs on inflation and economic growth. The next decision on interest rates will be announced on April 16.
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