Governor Tiff Macklem says the Bank of Canada will have to be \u201chumble\u201d in its return to formal economic forecasting as trade uncertainty continues to swirl.<\/p>\n
The central bank intends to publish a forecast for the economy at its upcoming interest rate decision on Oct. 29 \u2014 something it hasn\u2019t done since the start of this year as U.S. tariffs clouded the economic horizon.<\/p>\n
Macklem is in Washington, D.C., this week for the International Monetary Fund\u2019s annual meetings with the heads of other central banks and financial policy-makers.<\/p>\n
He told reporters on a call from the sidelines of those meetings that uncertainty around the U.S. tariff campaign has decreased since the spring.<\/p>\n
\u201cUncertainty about the stability and trajectory of the global economy is still high, but we have avoided the worst-case scenarios,\u201d Macklem said, citing the IMF\u2019s updated World Economic Outlook.<\/p>\n
But threats to global trade persist. Macklem said a potential escalation between China and the United States, if it came to pass, \u201cwould be very significant from a global perspective.\u201d<\/p>\n
At home, Macklem said the uncertainty has now shifted to next year\u2019s review of the Canada-U.S.-Mexico Agreement on trade, which currently allows the bulk of Canadian goods to enter the United States tariff-free.<\/p>\n
With those risks outstanding, Macklem said the Bank of Canada \u201cwill need to be humble about our forecasts, and we will continue to put a lot of emphasis on the risks.\u201d<\/p>\n
The Bank of Canada will get a look at two fresh sets of data next week \u2014 its own quarterly surveys of businesses and consumer expectations and Statistics Canada\u2019s report on September inflation.<\/p>\n
To this point, Macklem said businesses are telling the central bank in surveys that the ongoing uncertainty has been holding them back from investments and hiring.<\/p>\n
But he said the artificial intelligence boom has been a \u201ccountervailing force\u201d to boost investment in the face of uncertainty, particularly in the United States.<\/p>\n
\u201cAI has the potential to be an important tailwind, increasing productivity and sustaining non-inflationary growth,\u201d Macklem said\u201d<\/p>\n
\u201cBut it also poses risks and we all agreed we need to better understand the complex macroeconomic impacts of AI, including the labour market implications.\u201d<\/p>\n
The Canadian jobs market surprised many economists earlier this month when StatCan reported a gain of 60,000 positions in September.<\/p>\n
Commenting on the jobs report, Macklem noted that the economy shed more than 100,000 positions over July and August, and any one \u201cmonthly number is not definitive.\u201d<\/p>\n
\u201cWhat you see over a number of months is \u2026 a labour market that has softened,\u201d he said.<\/p>\n
The Bank of Canada cited weakness in the jobs market as one of the key factors fuelling its quarter-point interest rate cut last month.<\/p>\n
But Macklem was tight-lipped as usual on where the central bank was leaning for its rate decision at the end of the month.<\/p>\n
He said monetary policy-makers will be looking at how tariffs and uncertainty are spilling over into Canadian export volumes and investment levels, as well as the overall inflation outlook, in guiding its upcoming decision.<\/p>\n
Macklem also suggested the central bank would be paying close attention consumption levels, which he said \u201chas been showing some resilience\u201d lately, in charting the path for interest rates.<\/p>\n
\u201cLet\u2019s get all the data, let\u2019s look at the forecast, let\u2019s have the deliberations and we\u2019ll come to our best assessment and a decision on Oct. 29,\u201d Macklem said.<\/p>\n
This report by The Canadian Press was first published Oct. 17, 2025.<\/p>\n
Craig Lord, The Canadian Press<\/p>\n","protected":false},"excerpt":{"rendered":"Governor Tiff Macklem says the Bank of Canada will have to be \u201chumble\u201d in its return to formal…\n","protected":false},"author":2,"featured_media":221260,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[45,49,48,46],"class_list":["post-221259","post","type-post","status-publish","format-standard","has-post-thumbnail","category-economy","tag-business","tag-ca","tag-canada","tag-economy"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts\/221259","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/comments?post=221259"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts\/221259\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/media\/221260"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/media?parent=221259"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/categories?post=221259"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/tags?post=221259"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}