As expected, the Bank of Canada has cut another 25 basis points off its key interest rates.
The cut means the overnight rate is now 4.25 per cent, 4.25 per cent for the deposit rate, while the bank rate is 4.5 per cent.
The news should be welcomed by those seeking a bank loan or mortgage.
"As expected, inflation slowed further to 2.5 per cent in July," said the Bank on Wednesday morning. "The bank's preferred measures of core inflation averaged around 2.5 per cent, and the share of components of the consumer price index growing above 3 per cent is roughly at its historic norm."
It noted inflation in some areas, including shelter costs, remain elevated but are beginning to slow.
The Canadian economy grew a little more than the Bank expected, growing 2.1 per cent in the second quarter, but there are indications economic activity was soft in June and July. It credited government spending and business investment for the expansion.
Employment hasn't changed much in recent months. The labour market continues to cool, and wage growth, relative to production, is stronger.
The global economy also grew in the second quarter by 2.5 per cent, fueled by the strength of the U.S. and European economies. Weak domestic demand in China weighed on the economy worldwide.
Global financial conditions eased in recent weeks, and the Canadian dollar has appreciated against a lower U.S. dollar. Oil prices also dipped more than expected in the Bank's last report in July.
The Bank said it continues to monitor inflation and remains resolute in its commitment to restoring price stability.
Statistics Canada releases its Consumer Price Index report for August on September 17. The next policy decision from the Bank is on October 23.