The long-awaited interest rate cut has arrived — now what?

The Bank of Canada has cut its key interest rate for the first time in more than four years, marking a pivot in its long fight to tamp down inflation. After a quarter-percentage-point cut, the central bank’s benchmark rate now sits at 4.75% — welcome relief for variable-mortgage holders, businesses and others feeling the pinch of higher interest rates.

Scotiabank’s Chief Economist Jean-François Perrault is back to discuss the central bank’s decision to cut, what this means for Canada’s housing market and the broader economy, and what Canadians can expect in the months ahead. 

For an up-to-date breakdown of the Bank of Canada's key interest rate and its change over time alongside inflation numbers, visit our interest rate page. 

Key moments this episode:  

1:21 – JF's initial take on the central bank’s decision to cut its key rate 

1:50 – Why did the Bank of Canada decide to cut today? 

2:31 – Will inflation get back down to the Bank of Canada’s target? 

3:45 – What does this cut mean for Canadians? How will they feel the difference? 

5:00 – How many more cuts can we expect this year? How fast or slow will this process be? 

5:45 – What can we expect to see next year based on this latest cut? 

6:15 – Is this the ‘soft landing’ we’ve been hoping for? 

7:45 – What are the indicators that Canadians should be looking for to tell us the path ahead for future cuts? 

8:43 – The three key takeaways for Canadians from this latest decision