The Bank of Canada says the United States’ tariffs pose a threat to global economic stability and could reduce growth and increase unemployment in Canada.
In the event of prolonged U.S. tariffs, and Canada’s subsequent counter-tariffs, the trade war could increase the risks to Canadian financial stability by hurting banks and other institutions while making it more difficult for households and businesses to manage their debt loads, the Bank of Canada said in its latest Financial Stability Report (FSR).
“In the near term, the unpredictability of U.S. trade policy could cause further market volatility and strains on liquidity. In an extreme case, market volatility could turn into market dysfunction,” Bank of Canada Governor Tiff Macklem said during a May 8 press conference on the FSR….