Canada’s weakening economy and the lifting of most of the retaliatory tariffs on the United States contributed to the Bank of Canada’s decision to cut its interest rate, according to a recently released notice.
The Bank of Canada released a summary of the governing council deliberations that led the organization to cut its rate to 2.5 percent on Sept. 17.
The document notes there were three developments that occurred over the summer that led the council to decide it was the right time to drop the rate, including a weakening economy and a softening of the labour market; signs that pressure on inflation may be easing; and the removal of most retaliatory tariffs, which means less risk to future inflation….