The Bank of Canada announced on the 2nd that it will keep the benchmark interest rate unchanged at 2.25%. Canada has kept its benchmark interest rate unchanged since the end of October 2025. The Bank of Canada said in a press release on the same day that the Canadian economy recovered in the second quarter, but faced a high level of uncertainty. New US tariffs and the threat of further tariff action pose a risk to the sustainability of Canada's economic recovery. The Bank of Canada said that due to the ongoing conflict in the Middle East and little progress in reopening the Strait of Hormuz, the risk of upward inflation is increasing. The longer oil prices remain high, the greater the risk that prices will be transmitted to other goods and services. The Bank of Canada anticipates that the new US tariffs and Canada's retaliatory tariffs will also drive up costs for some businesses and may affect consumer prices over time.

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