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As the Bank of Canada cuts rates further, the case for cash in your investing account unravels

The article from The Globe and Mail discusses the implications of the Bank of Canada's decision to cut interest rates, suggesting that investors should consider holding more cash in their portfolios. It highlights that with the recent rate cut, the cost of borrowing has decreased, potentially stimulating economic activity but also reducing the returns on fixed-income investments like bonds. The piece argues that in a low-rate environment, cash can serve as a strategic asset, offering liquidity and flexibility, especially when other investment options might not yield significant returns. It also touches on the psychological comfort of having cash reserves during uncertain economic times, the potential for cash to act as a buffer against market volatility, and the tactical use of cash to take advantage of investment opportunities as they arise. The article concludes by suggesting that while cash might not traditionally be seen as an investment, its role in portfolio management becomes increasingly important in a low-yield, high-uncertainty economic landscape.

Read the Full The Globe and Mail Article at:
[ https://www.theglobeandmail.com/investing/markets/inside-the-market/article-as-the-bank-of-canada-cuts-rates-further-the-case-for-cash-in-your/ ]