BNY Mellon: Bank of Canada Unlikely to Consider Rate Cuts Before Q4

According to Jin10, BNY Mellon stated in a report that the market widely expects the Bank of Canada to maintain its policy rate at 2.25%, with no rate cuts considered at least until the fourth quarter. The report noted that recent core inflation trends and labor market growth support the central bank's decision to hold steady. However, if inflation surprises to the downside again, it could bring easing policy back onto the agenda. As Governor Tiff Macklem indicated, the Bank of Canada is prepared to 'act' if inflation expectations shift. BNY Mellon pointed out that in Canada, unless the central bank's statement is significantly more cautious or hawkish than expected, its steady policy stance should not impact the market.