Bank of Canada Poised for Rate Cuts Amid Economic Slowdown

Desjardins predicts a series of reductions starting this spring, aiming to halve the current key rate by end of 2025 as Canada faces recession pressures.

• The Bank of Canada is expected to start cutting interest rates this spring, with the first reduction possibly in April, as inflation and economic growth slow.
• Desjardins forecasts a series of rate cuts through this year and into 2025, halving the current key overnight rate of 5% by the end of next year.
• Canada's economy is already in recession on a per-capita basis, with expectations of wage decreases providing further rationale for rate cuts.
• High mortgage renewal rates in 2025 pose a significant challenge to Canadian consumers, potentially increasing payments by up to 54%.
• Global economic outlooks vary, with the US expected to maintain solid growth despite a slowdown, while Germany struggles with a manufacturing downturn affecting its recovery.

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