Bank of Canada Expected to Hold Interest Rate Amid US-Canada Trade Tensions

The Bank of Canada is expected to keep its policy interest rate at 2.25 per cent on Wednesday, despite concerns over the recent trade war between the US and Canada.

Economists believe policymakers will maintain their wait-and-see approach as new tariffs and Ottawa's countermeasures threaten to slow the economy and put pressure on inflation.

The bank has remained on the sidelines since December, navigating a period of economic uncertainty with higher oil prices from the US-Iran war and now the trade spat.

TD economist Andrew Hencic said 'With where inflation and growth are tracking, we don't think that there's justification for them to change policy.'