Economics
Bank of Canada Faces Stagflation Risk If Trump Imposes Tariffs
- Trade war with US would weaken economy but raise prices
- It would put central bank ‘complicated space,’ Gravelle said
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Governor Tiff Macklem has successfully wrestled down one of the worst inflationary crises in the Bank of Canada’s history, putting his nation on track for a soft landing. US President-elect Donald Trump may dismantle all that with a stroke of a pen.
Trump’s threat to impose 25% tariffs on all Canadian goods, which he may try to carry out quickly through an executive order, would almost surely send the country into a deep recession. Nearly 2 million workers are employed in industries dependent on US demand for Canadian exports; the provinces of Ontario and British Columbia have estimated combined job losses of more than 600,000.