Bank of Canada Sticks with Key Rate Amid Tariffs and Iran War Fears

The Bank of Canada kept its benchmark interest rate at 2.25% for a seventh consecutive time, citing new U.S. tariffs and ongoing war in Iran as key factors.

Bank of Canada governor Tiff Macklem stated that the persistence of the Middle East conflict has increased inflationary risks due to rising global energy prices.

Macklem noted that while the economy is evolving broadly in line with the bank's forecasts, the ongoing uncertainty surrounding trade and energy prices means that monetary policy cannot offset these effects.