Statistics Canada has released the inflation rate for February, showing a slight increase from 1.9% in January to 2.1%, while the core inflation rate also rose to 2.1%.

However, the Bank of Canada decided to cut interest rates on March 12, lowering the benchmark rate by 25 bps. This marks the seventh consecutive month of rate cuts due to concerns over Canada’s economic growth.

The newly initiated trade war between Canada and the U.S., led by the imposition of a 25% tariff on Canadian steel and aluminum exports to the U.S., has already taken effect. Nevertheless, investors remain concerned that this tariff hike could contribute to further inflationary pressures.

Source: Fxstreet