Jan 29, 2025
Here is a summary of today's interest rate day announcements:
Bank of Canada - Cuts rates by 0.25% (3.00%)
Business investment remains weak, but exports supported by new oil & gas capacity
Labour market soft: Unemployment rate at 6.7% in December.
US trade tariffs a key uncertainty: could weaken GDP and raise prices.
Lower rates boosting household spending, with gradual economic strengthening expected.
BOC will end quantitative tightening; restart asset purchases in March to slowly grow the balance sheet.
Federal Reserve - No change and maintains rates at 4.50%
Unemployment rate stabilized at a low level; Labour conditions remain strong.
Inflation remains elevated; target at 2% in the long run.
Economic Activity continues to expand.
Economic outlook remains uncertain; risks are closely monitored.
Continued reduction of Treasury securities, agency debt, and mortgage-backed securities.
It is worth highlighting the diverging financial conditions: U.S. bond yields rising and Canadian yields dropping slightly. There is a lot of uncertainty in the markets right now, as always forward contracts are a great tool to project your bottom line and secure your pricing.Â
Click here for the full BOC Statement: Bank of Canada reduces policy rate by 25 basis points to 3%, announces end of quantitative tightening - Bank of Canada
Click here for the full FOMC statement: Federal Reserve Board - Federal Reserve issues FOMC statement