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Special Report

Canada Monetary Policy
Research Brief

June 2024

Bank of Canada Provides Relief to Consumers
and Commercial Real Estate Investors

Central Bank lowers policy rate for the first time in four years. On the heels of moderating inflation, softer than expected economic growth, and a gradual easing in wage pressures, the Bank of Canada cut its overnight rate by 25 basis points in June, bringing it to 4.75 per cent. This move comes after the Central Bank slashed its benchmark interest rate to a record low of 0.25 per cent in March 2020, in response to the global health crisis. The monetary authority kept its policy rate at near zero for two years, then started raising it rapidly to tackle runaway inflation. Between March 2022 and July 2023, the Central Bank hiked its overnight rate 10 times for a total of 475 basis points. In addition to the June rate cut, the BoC indicated it believes inflation will continue to trend down, suggesting further cuts will likely materialize over the remainder of the year. These factors will not only benefit consumers, but commercial real estate investors who are awaiting positive signs regarding the cost of debt. 

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