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The kept interest rates unchanged on Wednesday, keeping it at 2.25 per cent after a turbulent period of economic data.
This is the fifth consecutive rate hold by the central bank since it last cut borrowing rates in Canada in October 2025.
In a statement, Governor Tiff Macklem highlighted the four-month long conflict in the Middle East pushing up energy prices and disrupting global supply chains.
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U.S. tariffs was also underscored as a source of “elevated” uncertainty as the U.S. administration continues proposing new tariff policies that may further impact the Canadian economy.
“Governing Council decided to maintain the policy rate at 2.25 per cent,” Macklem said in the statement.
“Economic activity in Canada has been weak and uncertainty about U.S. trade policy persists. The conflict in the Middle East is ongoing and oil prices remain elevated.”
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Although the Iran war has resulted in higher prices at gas pumps, Macklem said, “there has been limited evidence of broad-based pass-through of higher energy prices to other consumer prices.”
Macklem also said in the statement that food price inflation “remains high,” but has also moderated.
– more to come
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