They also observed that monetary policy is better suited to controlling inflation by influencing demand than to addressing supply shocks.
The Bank of Canada also outlined three possible tariff paths: a continuation of current restrictions, a de-escalation, and an escalation. None projected a sharp rise in inflation, and surveys of consumers and businesses suggested inflation expectations remained anchored.
The deliberations said tariff effects on consumer prices were modest so far but only beginning to appear in the data, while risks to inflation remained elevated due to underlying pressures and trade uncertainty.
Randall Bartlett, deputy chief economist at Desjardins, said in a Reuters interview that the fact a rate cut was discussed suggests the governing council is leaning toward additional easing.
Desjardins forecasts a cut at the September meeting, with the possibility of further reductions later in the year.