The Bank of Canada announced a 25 basis point interest rate cut, becoming the first G7 country to do so

The Bank of Canada cut interest rates by 25 basis points for the first time since 2020, in line with market expectations, becoming the first central bank in the Group of Seven to start an easing cycle. Officials said they were more confident that inflation was moving toward the 2% target and said that if progress continued, "there is reason to expect further rate cuts." "With more and more consistent evidence that underlying inflation is easing, monetary policy no longer needs to be as restrictive as before," said Governor Macklem. Since the beginning of the year, inflation in Canada has slowed faster than expected. CPI slowed to 2.7% in April, while the central bank forecast 2.9% in the second quarter. Underlying price pressures have also eased for four consecutive months, with the average of the two core indicators reaching 2.75% in April. (Jinshi)