Summary

• The Bank of Canada held rates steady at 2.25%, but sounded relatively relaxed for now on inflation risks.
• At the same, there are lingering concerns about the jobs market and USMCA renegotiations.
• We share those concerns, and in our baseline scenario expect no hike this year, alongside only a gradual decline in USD/CAD over the remainder of this year.

By James Knightley, Chief International Economist, US and Francesco Pesole, FX Strategist

Jobs and USMCA concerns keep BoC slightly dovish

The Bank of Canada left its policy rate at 2.25% as expected, but the overall

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