Fiera CEO says Bank of Canada has clear path to 3% interest rate
BNN Bloomberg
The head of one of Canada’s biggest asset managers says “the conditions are right” for the Bank of Canada to cut its policy interest rate to around 3 per cent by the end of next year.
Fiera Capital Corp. Chief Executive Officer Jean-Guy Desjardins said markets “have not dramatically or significantly reacted” to signals that the central bank is poised to lower its benchmark rate from the current 4.75 per cent to a “neutral stance.”
Getting the bank’s policy rate to neutral would imply about 175 basis points of cuts, he said.
The Canadian dollar has weakened 2 per cent over the past three months as it became clearer that the Bank of Canada would be in a position to cut rates ahead of the U.S. Federal Reserve. It finally did so last week, and central bank officials noted it was “reasonable to expect further rate cuts” if inflation continues to cool.
