BOC Macklem: Hope is new trade deal will lead to tariffs being removed

BOC Macklem is speaking and says:

• Prospect for a new Canada – US trade deal offers hope that tariffs will be removed.
• Prospects for a trade deal is encouraging, and we are following developments closely
• Cutting rates would be more difficult if recent firmness and underlying inflation persists.
• Until a trade deal inflation will be affected by both US tariffs and Canadian counter tariffs.
• Proceeding carefully with monetary policy.
• Rate cut could be needed if effects of US tariffs and uncertainty continue to spread through the economy and cost pressures on inflation were contained.
• We are watching closely for signs that weakness in the US job market is broadening.
• Assessing inflationary impact of tariffs has been a moving target because US has repeatedly change the size and scope of tariffs.
• Final domestic demand in Canada was insulting the first quarter, and if tariffs and uncertainty continues, households and businesses will likely remain cautious.

The USDCAD is steady through the comments but remain near the highs and swing area between 1.36858 and 1.36923.

This article was written by Greg Michalowski at www.forexlive.com.