BoC Governor Tiff Macklem reinforced the Bank’s dovish lean today, stating that further rate cuts could be warranted if the economic fallout from US tariffs deepens and inflation pressures remain contained.
“Overall, my colleagues on Governing Council and I agreed there could be a need for a further reduction in the policy interest rate if the effects of U.S. tariffs and uncertainty continued to spread through the economy and cost pressures on inflation were contained,” Macklem said in a speech today, outlining the Bank’s conditional easing bias.
BoC has already cut rates seven times in this easing cycle. The June 4 decision to hold rates steady at 2.75% was shaped by three key concerns: lingering uncertainty, a mildly weaker domestic outlook, and some renewed firmness in core inflation. The mixed signals left policymakers in wait-and-see mode.
