As expected, the Bank of Canada Wednesday morning cut its benchmark overnight rate by 25 basis points to 4.75%.
The move was anticipated by most economists as policymakers in Canada had previously signaled satisfaction with the direction of inflation alongside some concern about slowing economic growth.
"[It is] reasonable to expect further cuts to our policy interest rate" if inflation continues lower, said BoC Governor Tiff Macklem in prepared remarks following the decision.
At press time, bitcoin (BTC) was little-changed following the news, trading at $70,500.
With its action today, the BoC becomes the first of the G-7 central banks to begin what's expected to be a cycle of easier monetary policy after a multi-year battle to cool inflation. Economists are expecting the European Central Bank to become the second of the major central banks to ease at its meeting tomorrow.
And though some members of the U.S. Federal Reserve have recently suggested that bank may hold off on any rate cuts for all of 2024, recent economic data have revealed slowdowns in both economic growth and inflation. Traders currently have priced in a near-60% chance of a rate cut either prior to or at the Fed's September meeting, according to CME FedWatch.
Other things being equal, tighter monetary policy is often a headwind for risk assets – bitcoin among them – as higher rates boost competition for investor capital. With a cycle of lower interest across Western economies seemingly at hand, bitcoin bulls might soon have their sights set on the crypto's all-time high from March above $73,500.