Former Alberta teacher sentenced to 4 years for sexually assaulting student
A former Alberta teacher has been sentenced to four years for sexually abusing a student.
The Bank of Canada made a sizable cut to its key lending rate Wednesday from 4.25 per cent to 3.75 per cent as the global economy continues to expand.
The half percentage point cut is the fourth rate cut in a row by the central bank as inflation dropped from 2.7 per cent in June to 1.6 per cent in September.
“We took a bigger step today because inflation is now back to the 2 per cent target and we want to keep it close to the target,” Bank of Canada governor Tiff Macklem said in a statement.
The central bank is expecting inflation to stay around two per cent in October as its surveys suggest business and consumer expectations of inflation have improved.
“I think Canadians can breathe, breathe a sigh of relief,” said Macklem, acknowledging that Canadians have been struggling under the weight of high inflation.
That point was underscored by Senior Deputy Governor of the Central Bank Carolyn Rogers when pressed on how Canadians aren’t necessarily feeling like their finances are doing better, despite this fourth straight rate cut.
“It means that prices aren't going to keep going up, but every time you go to the grocery store, I'm sure you're feeling that fact that prices have come up,” said Rogers, adding it’s going to take a little while for Canadians to feel the effects of the price of food, rent and housing stabilize.
Macklem says the decline in inflation over the last few months reflects the combined effects of lower oil prices, a dip in shelter price inflation in Canada and lower prices for several consumer goods like cars and clothes.
If the trend continues, Macklem expects more interest rate cuts in the future.
“Now, our focus is to maintain low, stable inflation,” said Macklem. “We need to stick the landing.”
As reporters peppered Finance Minister and Deputy Prime Minister Chrystia Freeland with questions about Liberal caucus unity, Freeland instead focused on the decision by the Bank of Canada.
“The good news on inflation, the good news on interest rates is overwhelmingly the important thing for Canada and Canadians, and that is what has put a smile on my face,” said Freeland.
The significant rate cut had been anticipated by a number of private sector economists. However, others are calling for even steeper slashing going forward.
“Hopefully the bank rapidly tries to take out these high interest rates that are now actively harming the economy,” said David Macdonald, senior economist for the Canadian Centre for Policy Alternatives.
Macdonald wants to see the central bank get to the neutral interest rate of 2.75 per cent more quickly. That’s the point at which the interest rate is not harming nor helping the economy.
The Bank of Canada is pictured in Ottawa on Tuesday, Oct. 22, 2024. THE CANADIAN PRESS/Sean Kilpatrick
Wednesday’s half percentage point cut should benefit people who are carrying a variable mortgage or have a line of credit. However, there are some in the housing industry who doubt the rate cut will be followed by a flood of people looking to buy homes.
Mortgage broker Ron Butler told CTV News a 50-basis point cut in the key lending rate is an indication of weakness in the economy.
“In a weak economy, it's not that common for people to go out and make what's potentially the biggest purchase of their lives,” said Butler. “So it's a bit of a two-edged sword.”
The Bank of Canada expects the global economy to expand at a rate of about three per cent over the next two years, with growth in the United States expected to be stronger than previously forecast.
“Household spending and business investment have picked up this year, but remain soft,” Macklem told reporters.
The central bank also notes financial conditions across the world have eased and global oil prices are about ten dollars lower than predicted in the July monetary policy report.
According to the bank, the Canadian economy grew by around two per cent in the first half of the year and is expected to grow by 1.75 per cent in the second half of 2024. Exports in Canada have also been boosted by the opening of the Trans Mountain Expansion pipeline.
But it’s not all good news. The central bank notes the Canadian labour market remains soft as the unemployment rate rose to 6.5 per cent in September, a full percentage point higher year over year.
“Business hiring has been weak, which has particularly affected young people and newcomers to Canada,” said Macklem, adding the number of workers has increased faster than the number of jobs.
According to the bank, GDP growth is expected to gradually strengthen to about two per cent in 2025 and 2.25 per cent in 2026 as a result of lower interest rates.
A former Alberta teacher has been sentenced to four years for sexually abusing a student.
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