Bank of Canada Weighs Rate Decision Amid Escalating Trade Tensions

The Bank of Canada is set to make its interest rate decision on Wednesday amidst renewed trade war pressures with the United States.

The central bank has kept its benchmark rate at 2.25 per cent for nearly a year now and most economists believe it will stick to the status quo as it tries to understand how prices and the economy react to a re-escalating trade war.

Financial market odds for a seventh straight hold in the policy rate stand at 99 per cent, according to LSEG Data & Analytics.

Bank of Canada governor Tiff Macklem has warned that any tightening of trade restrictions between Canada and the U.S. might push monetary policymakers to ease the policy rate instead of raising it.