Bank of Canada Cuts Overnight Rate
Bank of Canada lowered overnight interest rate by 0.25% to 4.25% today during its scheduled meeting; this interest rate will be used until at least the next such meeting which will be held on January 22, 2008.
Bank of Canada announced that since the last Monetary Policy Report there were numerous economical and financial events that influenced both the economical growth of the country and the inflation.
October total CPI and core CPI were 2.4% and 1.8% respectively - both below the Bank of Canada expectation level. While economical growth was showing a stable growth, downside inflation risks combined with the excess Canadian dollar apppreciation against U.S. dollar and the subprime lending crisis affecting financial market, caused Canada’s central bank to lower their target overnight rate to 4.25%.
The date of the next Bank of Canada meeting regarding interest rate policy is January 22, 2008, but the Monetary Policy Report Update will be published on January 24, 2008.