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2026-09-21 23:26:12
[Bank of Canada: New US Tariffs Could Push Canada's Q4 Economic Growth Below 1%] Bank of Canada Governor John Macklem said on Monday that new US tariffs could cause Canada's fourth-quarter economic growth to fall below 1%. Macklem stated that when assessing interest rate policy, the central bank needs to consider two factors: slower economic growth could push inflation down, but the Middle East conflict leading to higher oil prices could, in turn, push inflation higher. He noted that Canada's current annual inflation rate is 3%, well above the central bank's 2% target; if oil prices remain around $100 per barrel, the inflation rate could rise slightly further. The Canadian economy rebounded in the second quarter, with an annualized growth rate of 3.3%. After nearly 18 months of the impact of US tariffs, businesses and households began adjusting their plans and resuming investment and consumption arrangements. However, with the breakdown of negotiations on a potential trade agreement between the two countries, US-Canada relations have further deteriorated, and the US has introduced a new round of tariffs. Macklem stated, "This latest round of escalation could again cause businesses to postpone investment and hiring decisions." He said that if these new tariffs persist, Canada's fourth-quarter economic growth could be roughly halved, falling below 1%.
