Canada Bank maintains its key rate at 2.75 %

The Bank of Canada maintains its 2.75 % key rate for a fourth consecutive month in a context where employment remains relatively solid. However, despite trade tensions with the United States.

This decision of the Central Bank. In addition, which remains cautious despite a rate of inflation after all in a year, was widely awaited by economists and markets.

Although the annual inflation rate remains around the 2 % target that the Banque du Canada aims at. Similarly, the institution is not ready to reduce its key rate insofar as the job market is solid in Canada with the creation of 83,000 jobs in June and underlying inflation which is maintained against all expectations around 3 %. Nevertheless,

In Canada. Nevertheless, American customs duties disrupt trade, but overall, the economy shows a certain resilience so far.

Although the expenses of Canadian companies. households are hampered by the uncertainty surrounding trade tensions with the United States and that labor market conditions in the foreign trade are deteriorating, the Central Bank notes that employment is maintained in other economic sectors.

After the increase in GDP of the start of the year caused by companies that have ahead of their exports in anticipation canada bank maintains its key of the taxation of American customs duties. the Banque du Canada provides that the gross domestic product in Canada should drop by approximately 1.5 % in the second quarter of 2025.

This contraction is mainly explained by the marked slowdown in exports which followed the Devanance. but also by the drop in American demand for Canadian goods due to customs dutieswe explain.

From a more global point of view. the Bank of Canada notes that the world economy remains reasonably resilient Despite the commercial turbulence caused by unpredictable, even erratic, pricing policies of the American government.

In the United States. the rate of growth was modeled during the first half of 2025, but the labor market remained solid. Additionally, The inflation measured by the Consumer Price Index (IPC) increased slightly in June in the United States. and some signs indicate that canada bank maintains its key customs duties are starting to be passed on to these prices.

In Europe. growth was less than in the United States in the first quarter of 2025 while in China, the drop in delivery of goods for the United States was largely compensated by an increase in exports to the rest of the world.

Canada bank maintains its key

When will a drop in rates?

The last drop in the master rate in the country dates back to March 2025. while the institution had reduced it by a quarter of a point. Does the institution are considering new decreases in its key rate?

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Taken as a whole. the indicators believe that the excess offer in the economy has increased since Januarynotes the governor of the Bank of Canada, Tiff Macklem.

Stressing that unemployment – to 6.9 % in June – has increased gradually since the start of the year. that wage growth slows down, it does not exclude the possibility of new decreases. But not for the moment.

If the weakening of the economy canada bank maintains its key weighs with additional drop pressure on inflation. upward pressures on prices due to commercial disturbances are contained, a reduction in the key rate may be necessary, explained Mr. Macklem.

The next revision of the Bank of Canada’s key rate is to take place on September 17.