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‘The Bank Really Is in a Difficult Position Here’: Why the BoC Faces ‘Risky’ Interest Rate Decision

  • The Bank of Canada will announce its interest rate decision on Wednesday amid a fragile Canadian economy and recent tariff threats.
  • This decision follows an April pause after seven consecutive cuts, with uncertainty from U.S. tariff increases on steel and aluminum starting the same day.
  • Economic data show a 2.2% annualized GDP rise in Q1 driven by tariff-avoidance activity, but trade-sensitive manufacturing contracted and unemployment rose to 6.9%.
  • Economists like Avery Shenfeld and Andrew DiCapua note no single rate decision is fatal but highlight growing pressure for rate relief if softness continues, while Stephen Brown projects three cuts lowering rates to 2%.
  • The bank’s challenge includes balancing inflation control and economic support, with tariff-related risks potentially slowing growth and requiring cautious policy amid mixed signals.
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28 Articles

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Left
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Center
5
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1
Lean Left

In a high-risk context, against the backdrop of new tariff threats from Donald Trump, economists do not agree on the content of the decision.

·Montreal, Canada
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Center

The central bank's next decision on the key rate is expected on Wednesday.

·Montreal, Canada
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City NewsCity News
+12 Reposted by 12 other sources
Center

'Mission impossible': Why the Bank of Canada faces 'risky' June rate decision

Few would confuse Hollywood action star Tom Cruise with Bank of Canada governor Tiff Macklem. But while Cruise rides a plane in tailspin to his latest box office smash, some economists say Macklem finds himself in his own high-stakes circumstances with the central bank’s interest rate decision on Wednesday. Macklem’s mission is to chart a […]

·Toronto, Canada
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BIV News broke the news in on Monday, June 2, 2025.
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