Canada’s cooling economy prompted country’s central bank to hold interest rates at five per cent this week, and economists say rate cuts could be possible in first few months of 2024.
following weaker-than-expected GDP data and slowing labour market. Signs of an overall cooldown have several economists forecasting the first rate cut to come from the bank in the first quarter of next year. “It seems that the Bank is confident it has done enough to gradually bring the Canadian economy back to balance. And we agree,” Randall Bartlett, senior director of Canadian economics at Desjardins, wrote in a note to clients on Wednesday.
As for the magnitude and pace of the rate cuts, Capital Economics’ Stephen Brown is predicting a 50 basis point drop each quarter of next year, he told BNNBloomberg.ca in an email on Thursday. “We’ve got the Bank of Canada cutting interest rates by 50 basis points in each quarter of 2024, to take the policy rate from five per cent down to three per cent,” he wrote.
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