Bank of Canada note
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Members of the Bank of Canada’s governing council were split, when they met earlier this month, on how long the central bank should wait before it starts cutting interest rates.

The central bank released its summary of deliberations Wednesday, detailing the governing council’s discussions ahead of its decision to hold interest rates steady on April 10.

Some members felt the central bank should take its time before lowering rates, the summary said, given the Canadian economy’s strong performance as well as ongoing inflationary risks.

Meanwhile, other members emphasized that inflation has slowed, and were concerned about keeping interest rates high for too long.

“Some members emphasized that, with the economy performing well, the risk had diminished that restrictive monetary policy would slow the economy more than necessary to return inflation to target,” the summary said. “Others placed more emphasis on the progress made in bringing inflation down.”

Despite those differences, the summary notes the governing council agreed to hold the key interest rate at 5% for now and that when rate cuts come, they won’t happen all at once.

“While there was a diversity of views about when conditions would likely warrant cutting the policy rate, they agreed that monetary policy easing would probably be gradual, given risks to the outlook and the slow path for returning inflation to target,” the summary said.

Economists widely expect the Bank of Canada to begin lowering its policy rate in June or July.

The Bank of Canada has been encouraged to see a significant slowdown in inflation, including in underlying price pressures.

Canada’s inflation rate was 2.9% in March, within the central bank’s one to 3% target range. Core measures of inflation, which strip out volatile price movements, have also eased over the last few months.

In a news conference on April 10, governor Tiff Macklem said an interest-rate cut in June was “within the realm of possibilities.”