Bank of Canada Plans Economic Forecast Amid US Tariff Concerns
The Bank of Canada plans to release new economic and inflation projections, following a period of uncertainty related to U.S. tariffs. With a reduced policy rate and key risks subsiding, the bank anticipates moderate economic growth, despite potential impacts from a trade agreement renegotiation among Canada, the U.S., and Mexico.
- Country:
- Canada
The Bank of Canada is preparing to unveil updated economic and inflation forecasts in its upcoming monetary policy report slated for October. This decision comes after a suspension in baseline estimates due to uncertainties surrounding U.S. tariffs under President Donald Trump.
Governor Tiff Macklem highlighted that the central bank reduced its policy rate to 2.5%, the lowest in three years, amid ongoing risks. With a 55% chance of another rate cut by October's end, the bank remains cautious, though it notes decreasing inflation risk thanks to diminished counter-tariffs on U.S. goods.
Despite these developments, the bank warns of slow economic growth exacerbated by weaker business investments and sluggish household spending, compounded by impending U.S.-Mexico-Canada trade negotiations. Nonetheless, consumption is expected to bolster economic stability in the near future.
(With inputs from agencies.)
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