The Bank of Canada's next move

Two weeks after the decision, the Bank published its summary of deliberations, the closest thing to minutes of the meeting. The Governing Council wrote that supply shocks 'can present a tension between addressing economic weakness and rising inflation'. A supply shock is a sudden event, such as a war or a tariff, that makes goods scarcer or costlier. The Council agreed that the inflation forecast, and the risks around it, would guide its stance. Weaker growth from the trade conflict, it noted, could keep inflationary pressures contained. If higher energy prices did spill over into other prices, it said, that could require a rate response. Any weakness in growth, it wrote, 'will be factored into the forecast for inflation'. It would also watch whether the recovery is sustained. Two data releases, on October 9 and October 19, come before the October 28 decision.