BoC Holds Fire on Interest Rates Amid Oil Price Concerns

The Bank of Canada is expected to keep its policy rate unchanged at 2.25% on Wednesday, marking the seventh consecutive meeting without a rate change.

According to the central bank's statement, persistent increases in oil prices could require consecutive rate hikes, although Governor Tiff Macklem stressed that this was not the base case.

The BoC sharply downgraded its Canadian growth forecast for 2026 to 0.7% from 1.2%, but expects annualized GDP growth of 2.5% in Q2 and 1.8% in both 2027 and 2028.