0809 ET - The Bank of Canada might walk back some of the hawkish language it used in late April when Governor Tiff Macklem spoke about the possibility of more than one rate increase to tame inflation, says Sebastien Mc Mahon, chief economist at Industrial Alliance Global Asset Management. "There is too much slack in the economy for any hawkish turn," Mc Mahon tells WSJ, in reference to the surprise decline in Canada GDP during 1Q. "We expect a recalibration in tone." The risk of higher inflation remains due to the Iran conflict, with fighting breaking out over the weekend between Iran and Israel. Canada, however, is still not seeing broad-based inflationary pressures, Mc Mahon adds. He expects the BOC to eventually raise interest rates but not until 1H of 2027. (Paul.Vieira@wsj.com; @paulvieira)

(END) Dow Jones Newswires

June 09, 2026 08:09 ET (12:09 GMT)

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