Description: In a decision that came as a shock to most economists, the Bank of Canada cut its rate on overnight loans by a quarter point to 0.75%. Canada was the first among the Group Seven countries to cut its interest rate.

Source: CBC

Date: January 21, 2015

Video Link: http://www.cbc.ca/player/News/Business/ID/2649342059/

Questions for Discussion:

1. Discuss how this interest rate cut will effect both businesses and consumers?
2. Analyze the reasons that influenced Bank of Canada to cut its interest rate?
3. How does an interest rate cut leads to increased consumption?