Macklem: Some factors causing increase in core inflation should unwind

Good morning. I’m pleased to be here with Senior Deputy Governor Carolyn Rogers to discuss today’s monetary policy decision. Today, Governing Council held the policy interest rate at 2.75%. This decision reflects three main considerations. First, uncertainty about US tariffs on Canada is still high. Discussions between Canada and the United States are ongoing, and US policy remains unpredictable. Second, while US tariffs are disrupting trade, Canada’s economy is showing some resilience so far. Third, inflation is close to our 2% target, but we see evidence of underlying inflation pressures. Today’s interest rate decision is accompanied by our July Monetary Policy Report (MPR). As in April, we have decided not to present a conventional forecast for growth and inflation. US tariffs are still too unpredictable to be able to provide a single forecast for the Canadian economy. So, we present three scenarios. The first is what we’re calling our current tariff scenario—it presents a view of how growth and inflation would evolve if the trade arrangements currently in place or agreed were to remain. The other two scenarios examine how things could play out if tariffs escalate, or if they de-escalate from where they are now BOC GOVERNOR MACKLEM REPEATS JUNE 4 REMARKS: THERE WAS CLEAR CONSENSUS TO HOLD OUR POLICY RATE UNCHANGED IN TODAY’S DECISION #Canada #interestrates #Macklem