BoC’s Macklem reaffirms dropping inflation target amid trade policy uncertainty

Bank of Canada (BoC) Governor Tiff Macklem noted that the BoC will not be revisiting its 2% inflation target for the foreseeable future, citing uncertainty around trade and ever-changing tariff policies from the United States (US).

Key highlights

The BoC will not revisit its 2% inflation target for monetary policy framework review next year.
Steep new US tariffs and the unpredictability of US policy have reduced economic efficiency and increased uncertainty.
Headwinds that limit supply could mean more upward pressure on inflation going forward.
By using scenarios, we were able to take a monetary policy decision that would fit a range of economic outcomes.