At the June 4 meeting, the Bank of Canada held rates unchanged at 2.75%. The market is pricing in a 20% chance of a cut on July 30 and just under a single full rate cut by year-end.

Yesterday, Canadian and US officials indicated they had set a 30-day deadline for a trade deal and that’s a key indicator on what the central bank will do next.

Highlights of the meeting:

• Boost in export growth could dissipate quickly as tariffs and uncertainty hit
• Members noted that underlying inflationary pressures could persist for an extended period as consumers and businesses adapt to the rewiring of global trade
• Pass-through of higher input costs to consumers would be difficult to track going forward
• Agreed they would need to watch developments in inflation across CPI components carefully
• Agreed the likelihood of a protracted and severe global trade war had diminished
• Short-term inflation expectations among consumers and businesses had risen
• Governing Council was encouraged by Q1 business investment but thought it was likely temporary
• There could be a need for further reduction(s) in interest rate if effects of tariffs and uncertainty continued to spread and cost pressures were contained

I don’t see any strong signal here that would move BOC pricing.