The Bank of CanadaSA国际影视传媒檚 governing council expects its second straight outsized interest rate cut helped it turn a corner in its fight to tame inflation, but it is watching the economy closely amid weaker than expected growth.

The central bankSA国际影视传媒檚 summary of deliberations released Monday offers a glimpse into the councilSA国际影视传媒檚 discussions in the lead up to the Dec. 11 rate cut, which lowered its key interest rate by half a percentage point.

Members considered only cutting by a quarter-point, but ultimately brought the rate down to 3.25 per cent in a bid to bring it closer to its so called neutral rate, where it is neither slowing nor speeding up economic growth.

SA国际影视传媒淔irst, with inflation at two per cent and the economy in excess supply, monetary policy no longer needed to be clearly restrictive,SA国际影视传媒� the summary said.

SA国际影视传媒淪econd, the outlook for growth was lower than expected in October, and stronger growth was needed to take up the slack in the economy and keep inflation close to the two per cent target.SA国际影视传媒�

The council members also discussed recent changes to CanadaSA国际影视传媒檚 immigration targets, noting the planned reductions in immigration will translate into lower GDP growth than the bank had forecast back in October.

The government had targeted bringing in 500,000 new permanent residents in both 2025 and 2026. Next yearSA国际影视传媒檚 target will instead be 395,000 new permanent residents, and that will fall to 380,000 in 2026 and 365,000 in 2027.

SA国际影视传媒淢embers agreed that further analysis would be needed to assess the likely timing of the demand and supply effects of new immigration targets as part of the preparation of the updated forecast in January,SA国际影视传媒� the summary said.

They also noted the tariff threats from incoming U.S. president Donald Trump are a SA国际影视传媒渕ajor new source of uncertaintySA国际影视传媒� for the Canadian economy.

SA国际影视传媒淭he impact on economic activity and inflation would depend on several factors, including the scope and size of the tariffs and any retaliatory measures that are taken, all of which are impossible to predict,SA国际影视传媒� the summary read.

SA国际影视传媒淢embers acknowledged that the increased uncertainty could already be affecting the outlook, particularly for business investment, but it was not possible to assess the broader implications without more information.SA国际影视传媒�

Council members also said theySA国际影视传媒檇 be considering further rate cuts, but would be taking a more gradual approach given the five consecutive cuts since June, and giving the economy time to respond to them.

SA国际影视传媒淭here was a range of views on how much further the policy rate would need to be reduced, and over what period that should happen,SA国际影视传媒� the summary said.

The next rate decision and quarterly economic forecast are scheduled for Jan. 29.

SA国际影视传媒擝y Nick Murray, The Canadian Press