Further interest rate cuts expected after Wednesday’s drop

In what will be welcome news to the industry, the Bank of Canada lowered its key “policy rate”—the rate at which it lends out money to financial institutions—on Wednesday. The quarter-percentage point cut dropped the interest rate to 4.25 percent. The policy rate started the year at 5.0 percent and there have now been three consecutive rate cuts. BOC governor Tiff Macklem said it was “reasonable to expect further cuts in our policy rate” as long as inflation stays under control.