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In his opening statement,ÌýgovernorÌýTiff Macklem said the decision was a “clear consensus” among members of the governing council.Ìý

“With a weaker economy and less upside risk to inflation, governing council judged that a reduction in the policy rate was appropriate to better balance the risks,” the bank wrote in a statement on Wednesday morning.

The bank had kept the policy rate atÌý2.75 per cent for three consecutive meetings,Ìýciting high uncertainty around U.S. PresidentÌýDonald Trump’sÌýtariffs and ongoing inflation pressures.Ìý

But now, with unemployment on the rise and economic activity contracting, someÌýeconomists have been calling on the bank to resume adding support to the economy.Ìý

Inflation data released TuesdayÌýalso showed that prices rose by less than expected, further supporting the argument for a cut.ÌýMacklem acknowledged that the removal of most retaliatory tariffs by Canada helps ease inflation pressures.Ìý

Going forward, bank officials warned they will be “proceeding carefully,Ìýwith particular attention to the risks and uncertainties.”

TheÌýbank said it will continue to assess how U.S. tariffs are impacting the economy as a whole, including business investment, employment and household spending. It will also observe changes to consumer prices and how inflation expectations evolve.

“The bank is focused on ensuring that Canadians continue to have confidence in price stability through this period of global upheaval. We will support economic growth while ensuring inflation remains well controlled,” the bank’s statement read.Ìý

The announcementÌýwill be followed byÌýÌýwith Macklem and senior deputy governorÌýCarolyn Rogers at 10:30 a.m.

This is a developing story.