US Fed's cautious approach may delay aggressive rate cuts by Bank of Canada

From Benefits and Pensions Monitor: 2024-06-18 10:09:46

The Bank of Canada may hold off on aggressive interest rate cuts due to the cautious approach of the US Federal Reserve. There may be one interest rate cut this year in the US to maintain its commitment to lower inflation rates. The Bank of Canada has already implemented one rate cut, bringing rates to 4.75%.

Governor Tiff Macklem and the Bank of Canada may wait for assurance from the US before making further rate cuts. It’s possible for Canadians to see one or two more cuts this year, bringing interest rates down to 4.25% by the end of 2024. Currency volatility from being a major commodity exporter also affects decision-making.



Read more at Benefits and Pensions Monitor: US Fed’s move on borrowing cost affect Canada’s decision on rates cut – Vanguard