A headline reads: " Bank of Canada cut the overnight lending rate by half a point." This suggests that:

Question

Quizplus · Accepted Answer

When the Bank of Canada cuts the overnight lending rate, it means that it is making it cheaper for banks to borrow money from the central bank. This is a form of monetary policy easing, aimed at stimulating economic growth and increasing borrowing and spending. The prime interest rate and bank rate are not directly affected by this action, and the velocity of money may or may not be impacted.

A Headline Reads: " Bank of Canada Cut the Overnight