Real Estate Blog

Bank of Canada Considers June Rate Cut Amid Easing Inflation

The Bank of Canada maintained its key interest rate at 5.0% during its latest decision but hinted at a potential rate cut in June, marking a shift in its monetary policy stance. This decision, expected by economists given the easing inflation and a stagnating economy, keeps the rate steady for the sixth consecutive time. Inflation, which began at historically high levels, cooled to 2.8% in February, and the Bank now forecasts it dropping to 2.2% by end-2024.

Governor Tiff Macklem indicated that the data supports a gradual decline in inflation while economic activity picks up. Although core inflation remains above 3%, it has started to decline, providing the central bank with cautious optimism about sustained progress. Despite this, risks such as elevated housing costs and geopolitical tensions could still pressure inflation rates.

The possibility of a June rate cut has opened up, according to Macklem, especially if upcoming data continue to show easing inflation. This dovish turn could set the stage for stimulating investment and hiring as the economy seeks to recover in the latter half of 2024.

If you have any questions about how these rates influence your buying or selling decisions, contact us today! 905.335.4102 info@roccasisters.ca