Bank of Canada cut a key rate due to virus fears

The Bank of Canada cut its key rate from 1.75% to 1.25% amid a rapidly spreading outbreak of coronavirus and said it was ready to soften monetary policy if necessary.

The Central bank said the epidemic was a significant negative shock to the prospects of the Canadian and global economies, and predicted further deterioration in business and consumer confidence.

«Amid the development of the situation, the governing council is ready, if necessary, to adjust monetary policy again to support economic growth and keep inflation at the target level,» representatives of the Canadian regulator said.

The regulator lowered rates for the first time in almost five years. The Central Bank last time reduced the rate by 50 basis points in March 2009 during the global financial crisis.