Bank of Governor Stephen Poloz announced the interest rate drop on Friday. Photo credit to C-PAC livestream.
The 50 point cut brings the rate to 0.25-percent. The central bank says it is providing economic support to the economy amid the COVID-19 pandemic. The unscheduled rate change is the third emergency rate cut and brings Canada in line with the United States’ Federal Reserve.
BOC Governor Stephen Poloz says the first action is the Commercial Paper Purchase Program will help to restore a key source of short-term funding for business.
The second action according to Poloz will help economic recovery after the pandemic is over, “The bank will begin acquiring Government of Canada securities in the secondary market. This will help address strains in the Government of Canada debt market and to enhance the effectiveness of all other actions taken so far. We will keep this program going until it’s clear the economic recovery is well underway.”
Poloz says the next update will come in mid-April.
