Macklem: BoC Will Make Its Own Rate Decisions

Bank of Canada Governor Tiff Macklem said the central bank's governing council will make monetary policy decisions based on Canada's economic situation, not influenced by Federal Reserve decisions or market predictions.

The statement came after the Fed hiked its benchmark interest rate by a quarter-percentage point to a target range of 3.75-4% last Wednesday, bringing the Canada-U.S. rate differential to 1.5-1.75 percentage points.

Macklem said there are key differences between the Canadian and American economies, leading to different interest rate decisions.

The Bank of Canada has been sitting on the sidelines for almost a year, leaving its key interest rate at 2.25%, as it waits to see how the economy adjusts to U.S. tariffs and global oil price shock.