Canada dramatically cuts key interest rate
Bank of Canada makes deep cut
Globe and Mail Update
December 9, 2008 at 3:59 PM EST
OTTAWA — The Bank of Canada has dramatically cut its key interest rate by a hefty three-quarters of a percentage point, blaming a “broader and deeper” global slowdown for driving Canada into recession.The central bank's overnight lending rate now stands at 1.50 per cent, a generational low and the likes of which have not been seen since the 1950s.
In response, however, Canada's major banks cut their prime lending rates by only half a percentage point, to 3.5 per cent, rather than following with a full three-quarters of a point reduction.
Canada's central bank joins a host of other central banks in making larger-than-usual rate cuts as their economies quickly fall victim to a stunning slowdown in global demand, led by a deeply troubled U.S. economy. The volume of world trade is likely to contract for the first time since 1982
“While Canada's economy evolved largely as expected during the summer and early autumn, it is now entering a recession as a result of the weakness in global economic activity,” the bank said in its first clear-cut declaration of a country in recession.
The last time the Bank of Canada cut its key rate so deeply was in the panic following the terrorist attacks of September 2001.
Most economists figure the Canadian economy will contract for at least two consecutive quarters, and many peg the recession dragging on longer than that –
www.davidvalente.com
Prudential Sussex Realty West Vancouver. Committed Service. Real Estate SALES. Real Estate North Vancouver. Real Estate West Vancouver. Real Estate Downtown Vancouver. Real Estate in the Lower Mainland. Buy and Sell Real Estate. Luxury Real Estate, Waterfront Real Estate, Investment Real Estate, First Time Home Buyers. Specialized in Residential Real Estate. Dave Valente. Deep Cove Listings. North Vancouver Luxury Real Estate Agent. Fine Homes International. Dollarton Real Estate. Deep Cove Homes For Sale. Deep Cove Realtor. North Shore Real Estate Agent. Real Estate Court Ordered Sales in Vancouver. www.deepcovelistings.com www.davevalente.com 2010 Olympics Vancouver Real Estate.