OTTAWA - The Bank of Canada delivered its third consecutive interest rate cut today, bringing its key lending rate to 4.25 per cent.
The quarter percentage point rate cut was widely expected by forecasters, given ongoing softness in the economy and easing inflation.
In his written remarks, governor Tiff Macklem says the central bank is encouraged by the ongoing slowdown in price growth and now wants to see economic growth pick up again.
The Bank of Canada noted that while the economy grew at a faster pace than expected in the second quarter, preliminary data for June and July suggest economic activity slowed.
Macklem reiterated that if inflation continues to ease as expected, it is "reasonable" to expect more rate cuts.
Canada's inflation rate has been edging closer to the Bank of Canada's two per cent target, reaching 2.5 per cent in July.