Canada Stocks Rally, Tracking Gains in US as Fed Sticks to Rate Cut Projection

Canada's stocks rallied, tracking gains in the US that were driven by Federal Reserve's decision to keep interest rates unchanged and stick with policymakers' median projection for three quarter-point rate cuts by December.

Advancers in Canada's stock market outnumber decliners 960 to 683, according to data compiled by moomoo. Metals and mining led gains, followed by software, transportation, telecommunications, banks and assets management.

Early in the afternoon, the Bank of Canada released minutes of its monetary policy decision on March 6, showing policymakers aknowledge that "if the economy evolves in line with the Bank's projection, the conditions for rate cuts should materialize over the course of this year."

"However, there was some diversity of views among Governing Council members about when there would likely be enough evidence that these conditions were in place, and how to weight the risks to the outlook," the summary of Governing Council deliberations stated.

Optimism that borrowing costs could start declining this year have fanned the rally both in Canada and the US.

If the economy evolves as projected, "the median participant projects that the appropriate level of the federal funds rate will be 4.6% at the end of this year, 3.9% at the end of 2025 and 3.1% at the end of 2026, " Fed Chair Jerome Powell said.