The Bank of Canada cut its overnight rate by 25 bps to 2.75%.

• The BoC pointed to an increase in uncertainty surrounded the economic outlook as a result of the intensifying trade war with the US: “…heightened trade tensions and tariffs imposed by the United States will likely slow the pace of economic activity and increase inflationary pressures in Canada. The economic outlook continues to be subject to more-than-usual uncertainty because of the rapidly evolving policy landscape.“
• The BoC says that it will try and assess whether future inflation changes are being caused by changes in costs from tariffs or changes in demand flowing to prices.