The Bank of Canada is seen in Ottawa, on April 16, 2025. Photo by THE CANADIAN PRESS/Justin Tang

The Bank of Canada cut its policy rate by 25 basis points on Wednesday to 2.5 per cent, citing a weaker Canadian economy and less upside risk to inflation as reasons for the move.

“Considerable uncertainty remains,” Bank of Canada governor Tiff Macklem said, according to a statement. “But with a weaker economy and less upside risk to inflation, governing council judged that a reduction in the policy rate was appropriate to better balance the risks going forward.”

Wednesday’s rate cut was widely expected by economists, after the Canadian economy contracted in the second quarter and the labour market lost a cumulative 100,000 jobs in July and August, pushing the unemployment rate up to

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