Bank of Canada deputy governor says trade uncertainty restraining investment

first_imgQUEBEC – A senior Bank official says uncertainty on the trade front is a factor restraining business investment.Deputy governor Sylvain Leduc says the central bank expects business investment to increase, but not as much as it could without this uncertainty.In announcing that it would keep its key interest rate on hold this week, the Bank of Canada dropped a reference to remaining “cautious.” Economists interpreted the change as a hawkish signal suggesting that the next interest rate hike may be sooner rather than later.However, the central bank also noted that ongoing uncertainty about trade policies was dampening global business investment and noted that stresses are developing in some emerging market economies.Leduc’s speech came after an announcement by the United States earlier today that it would impose tariffs on Canadian, Mexican and European Union steel and aluminium as of midnight tonight. Canada, Mexico and Europe were exempted from import duties of 25 per cent on steel and 10 per cent on aluminum when they were first imposed in March, but those exemptions expire Friday.The U.S. decision came as North American Free Trade Agreement talks continue.last_img read more