Interest rate unchanged as Bank cites uncertainty

The Bank of Canada announced this morning it would stand pat on its target for the overnight rate at 2.75%. The pause was not a surprise for economists as recent GDP numbers show Canada’s economy is stronger than many expected.

“The trade conflict initiated by the United States remains the biggest headwind facing the Canadian economy,” Bank Governor Tiff Macklem said, noting that it’s too soon to see impacts of retaliatory tariffs on consumer prices. “We will continue to support economic growth while ensuring inflation remains well controlled.”

Canada’s inflation rate eased to 1.7% in April, spurred by the elimination of the consumer carbon tax. The Bank’s next rate announcement is July 30.