The Bank of Canada Set to Announce Interest Rate Decision on Wednesday, Fueled by Rate Cut Speculation

June 3, 2024 TruthUSA

The Bank of Canada is set to announce its latest interest rate decision on June 5 amidst speculation about a possible rate cut.

Financial markets are generally anticipating a quarter-point reduction in the key lending rate, although opinions on this matter vary, with some expecting the bank to hold off for now.

Bank of Canada governor Tiff Macklem has acknowledged the potential for a rate cut but emphasized that the decision will be data-driven. While the central bank has observed the necessary conditions, it aims to ensure sustained progress towards price stability.

In April, the annual inflation rate decreased to 2.7 percent from 2.9 percent in March.

This interest rate decision follows a recent report by Statistics Canada showing that economic growth in the first quarter fell below the Bank of Canada’s projections. The report also revised downward the growth figures for the fourth quarter of 2023.

Despite these challenges, the April jobs report revealed a substantial increase in employment by 90,000, marking the largest monthly gain in over a year.