Bank of Canada Weighs Rate Decision Amidst Renewed Trade War Tensions

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

As tensions rise, the central bank has kept its benchmark rate at 2.25 per cent for nearly a year now. However, economists predict that the recent tariff volleys will have an impact on the economy.

Tony Stillo, director of Canada economics at Oxford Economics, said, 'The bank has been always hesitant to make a move on rates that they might have to retrace later, because things are so uncertain.'

Despite forecasts expecting the Canadian and US trade teams to reconvene, BMO chief economist Doug Porter warns that absent a return to negotiations, the third quarter of the year will resemble the early days of the trade war in 2025.