We’re probably going to see interest rates fall again this week.
Just a few weeks ago, you would have had to look long and hard to find an economist who said the Bank of Canada would trim another quarter point off its overnight rate at the March setting. Most were figuring we would have to wait until May or June for further relief.
But then along came tariffs.
There are so many layers of tariffs it is hard to keep them straight as some are delayed until next month but others are set to go ahead this week. And with their imposition, people start taking defensive action.
Trips to the US are down as an example. We’re also seeing less activity in the housing markets…sales in Toronto and Vancouver, for example, have dropped off quite sharply. Layoff notices are starting to appear in central Canadian factories.
All of this has economists now saying the central bank is probably leaning towards cutting another quarter point this week as a stimulative move with at least one chartered bank expecting negative growth in the second quarter of the year.
