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Bank of Canada today reduced it’s target overnight rate one more time. The bank surprised many experts in last January by lowering its target rate, now once more, the bank decided to cut the rate by quarter percent point.
Like gasoline price, prime rate do not appear to be going down anytime soon. TD announced a 0.1% cut so far. So prime will be 2.75%.
BoC shows the following reasons to back its decision to rate cut.

  • Oil price shock
  • Weak exports
  • Disinflationary pressures
  • Low inflation rate
  • BOC-overnight-vs-bank-prime-July-2015