BofA says Macklem’s backdrop differs from peers: Canada’s core inflation is roughly 2% and energy-rich provinces have seen short-term gains from the oil-price surge, leaving little sign of overheating. After a small Q1 contraction, Q2 annualized growth is expected above 2%; traders have pulled back wagers on a year-end BOC hike. BofA now expects the Bank of Canada to keep policy rates unchanged until 2027 even if the Fed resumes tightening.

2026-07-01

BofA says Macklem’s backdrop differs from peers: Canada’s core inflation is roughly 2% and energy-rich provinces have seen short-term gains from the oil-price surge, leaving little sign of overheating. After a small Q1 contraction, Q2 annualized growth is expected above 2%; traders have pulled back wagers on a year-end BOC hike. BofA now expects the Bank of Canada to keep policy rates unchanged until 2027 even if the Fed resumes tightening.