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Ottawa's Parliament Hill, where the Carney government is rolling out Canada's largest fiscal stimulus package since 1980. / Photo: Unsplash. MoneySavings.ca  ·  Economy & Policy Monday, April 13, 2026  ·  Daily Edition Canada at a crossroads: oil shock, frozen rates, and a trade deal on the clock Canada's economy is navigating a uniquely complicated moment in 2026. A Middle East conflict has sent oil prices surging past US$104 a barrel, a once-in-a-generation fiscal stimulus package is being rolled out in Ottawa, and the clock is ticking on a renegotiation of Canada's most important trade agreement. For everyday Canadians, this means uncertainty at the gas pump, a central bank with limited room to cut rates, and a federal government betting big on public spending to kick-start growth. Here is what you need to know about the forces shaping the Canadian economy right now. 1. The Bank of Canada is stuck — and oil is why The Bank of Canada has held it...
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Bank of Canada Holds the Line as Global Turmoil Clouds Outlook

 Bank of Canada Governor Tiff Macklem takes part in a press conference in Ottawa on September 17, 2025

The Bank of Canada has opted to keep its key interest rate steady at 2.25%, a decision that reflects the delicate balancing act policymakers face as global uncertainty intensifies. With inflationary pressures rising and economic growth showing signs of strain, the central bank is navigating a narrow path shaped by forces largely outside its control.

A major driver of the current tension is the surge in oil prices triggered by ongoing geopolitical conflict. Higher energy costs are feeding into broader inflation, raising concerns that price pressures could become more persistent. At the same time, elevated borrowing costs and weakening consumer confidence are weighing on domestic economic momentum.

By holding the rate, the Bank of Canada signals caution: it aims to avoid stifling growth while still keeping inflation expectations anchored. The central bank emphasized that it remains ready to adjust its policy stance if inflation accelerates or if economic conditions deteriorate further.

In this moment of global volatility, the Bank’s steady hand underscores the complexity of managing a small, open economy exposed to international shocks. The coming months will test whether this pause provides stability or simply marks a brief calm before further adjustments become necessary.



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