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BoC Minutes: Sufficient progress justifies start of gradual easing

Summary of deliberations from BoC’s June meeting revealed consensus among Governing Council members, who noted “four consecutive months” of easing in core inflation and indicators suggesting continued downward momentum. They concluded that there had been “sufficient progress” to warrant the initial rate cut.

BoC decided to reduce its policy rate by 25bps to 4.75% during the meeting, becoming the first G7 central bank to start monetary easing.

Council members also agreed that if inflation continues to ease and remains on a sustainable track to 2% target, it would be “reasonable to expect further cuts to the policy interest rate.”

They emphasized that monetary policy easing would likely be “gradual,” given the forecast that inflation will ease toward the target gradually. The timing of any further reductions in the policy rate will depend on incoming data and its implications for the future path of inflation.

Full BoC summary of deliberations here.

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