Bank of Canada Holds Rate at 2.25% as Macklem Warns 3% Inflation Could Rise
Updated
Updated · CBC Sports · Sep 2
Bank of Canada Holds Rate at 2.25% as Macklem Warns 3% Inflation Could Rise
3 articles · Updated · CBC Sports · Sep 2
Summary
Seven straight holds left the Bank of Canada’s policy rate at 2.25%, while Governor Tiff Macklem said inflation risks are increasing after July inflation hit 3%.
About 13% higher U.S. oil prices since July are the bigger threat, Macklem said, as the re-escalated Middle East conflict pushes up gasoline costs and could spread into other prices.
New tariffs are a secondary inflation risk: Washington imposed 50% duties on about $28 billion of Canadian goods, and Canada began matching them Tuesday on $27.6 billion of U.S. products.
The bank still sees a broadening economic recovery, but trade uncertainty and energy shocks are clouding the outlook ahead of its next forecast and rate decision on Oct. 28.
Economists split on what comes next, with Scotiabank seeing room for 75 basis points of hikes from late 2026 while CIBC expects no rate move this year.