Bank of Canada lowers key lending rate to 4.5% [Video]

Canada’s central bank on Wednesday lowered its key lending rate to 4.5 percent, saying the second straight cut of 25 basis points was warranted due to slowing inflation.

Canada had held its benchmark rate steady for almost a year at 5.0 percent, the highest level in two decades, before initiating a cut in early June.

That reduction to 4.75 percent made it the first among the Group of Seven leading economies to ease monetary policy in the current cycle.

“With broad price pressures continuing to ease and inflation expected to move closer to 2 percent, Governing Council decided to reduce the policy interest rate by a further 25 basis points,” the Bank of Canada said in a statement.

After an unexpected upturn in May, Canada’s annual inflation rate slowed to 2.7 percent year-on-year in June, the bank said, paving the way for Wednesday’s rate cut.

Although the modest cuts will …