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On Wednesday, the 4th of March 2020, echoing the leads of US Federal Reserve’s emergency rate-cut by 50 basis percentage point to a target range between 1% to 1.25%, the BoC (Bank of Canada) had slashed its key borrowing cost to a decade-low 1.25 per cent in order to duel the financial fallouts of a fast-spreading coronavirus outbreak which has been pushing the global economy at the cliff of a global-scale recession, remarking the second G7 nation to adopt an emergency rate-cut In point of fact, latest decision of the Central Bank of Canada to axe its core borrowing cost by 50bps to 1.25 per cent from a prior 1.75 per cent came forth a day after the US Fed had lowered its borrowing cost by 50bps, while the BoC had also pledged to further rate-cut as early as by next month, if the virus outbreak worsened.
Meanwhile, adding that the fast-spreading coronavirus outbreak came as a “material negative shock” to global and Canadian economic growth which would likely to deteriorate business and consumer confidence further over the coming weeks, the Central Bank of Canada said in a statement on Wednesday (March 4th), “As the situation evolves, (the Bank’s) Governing Council stands ready to adjust monetary policy further if required to support economic growth and keep inflation on target.
The Bank continues to closely monitor economic and financial conditions, in coordination with other G7 central banks and fiscal authorities. ”