Bank of Canada cuts rates and ends quantitative tightening
Macklem says monetary policy cannot offset negative effects of tariffs
The Bank of Canada reduced its policy rate by 25 basis points to 3% today (January 29) and ended its quantitative tightening programme.
Governor Tiff Macklem said there was “no doubt” the threat of tariffs had weighed on the bank’s decision. He said, however, that monetary policy cannot fully offset the negative effects of tariffs.
A trade war would badly hurt economic activity in Canada, Macklem said. He added it will be a complex shock for monetary policy-makers to respond to because it will
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