On July 30, 2025, the Bank of Canada announced its decision to maintain the overnight interest rate at 2.75%, marking the third consecutive meeting with no change. The decision, anticipated by all 28 economists polled by Reuters, reflects the Bank's cautious approach amid persistent inflationary pressures, with core inflation hovering around 3%. Ongoing uncertainties surrounding U.S. trade policies and tariffs could slow economic growth while increasing price pressures.

Despite recent economic resilience, with GDP growth at 2.2% in Q1 2025, the Bank noted a softer outlook for Q2 due to subdued domestic demand and trade-related disruptions. Governor Tiff Macklem emphasized the need to monitor inflation expectations closely to prevent a tariff-driven shock from becoming an inflation shock. He suggested a wait-and-see stance as the Bank assesses incoming data before its next announcement on September 10, 2025.

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