Don’t assume further rate cuts from the Bank of Canada, Poloz warns – Financial Post Don’t assume further rate cuts from the Bank of Canada, Poloz warns – Financial Post

The Bank of Canada’s anticipated focus on inflation means an interest rate cut is unlikely for the foreseeable future, says Osler Advisor Stephen Poloz in a Financial Post article.

“Inflation has been kind of firming lately, using the core measures the Bank of Canada pays attention to,” says Stephen. “And the counter tariffs that the government has put in place will start boosting inflation in the next couple of months.”

Stephen says the central bank had to learn a hard lesson during the post-pandemic era when inflation unexpectedly jumped higher than expected. “The central bank said, ‘Don’t worry, that’s a transitory thing.’ Well, transitory turned out to be two years,” he says,

Whether Canada’s central bank cuts rates or not will depend on what is causing the economy’s slowdown. “If it’s just uncertainty that’s causing companies to stop, pull back, then maybe cutting rates helps,” says Stephen. However, if tariffs are causing a more permanent structural issue in the Canadian economy, then monetary policy could prove ineffective. “Cutting rates in that context just boosts demand with no supply to meet it, and can actually cause inflation to go up,” he says.

Read the full article by Jordan Gowling posted on June 11, 2025.