THE Bank of Canada yesterday reduced its main interest rate by a quarter of a point, less than economists predicted, saying it will probably need to act again to fend off the effects of a credit crisis and global recession.

Governor Mark Carney and his five deputies trimmed the target rate for overnight loans between commercial banks to 2.25 percent, the lowest since October 2004. Seven of 24 economists surveyed by Bloomberg predicted the move, with 13 calling for a cut twice as deep and four expecting no change.

The credit squeeze spurred by the subprime mortgage meltdown is sapping demand for Canadian shipments of automobiles and lumber to the United States, Canada??s main export market.

The global financial crisis also may crimp the domestic spending that??s propped up Canada??s economy, according to policy makers.

Yesterday marked the first scheduled decision by a central bank within the Group of Seven major economies since a coordinated rate cut on October 8.