1116 ET - Canada's central bank is in a bind as it navigates a weak domestic economy, higher inflation from the ongoing U.S.-Iran conflict and elevated trade policy and geopolitical uncertainty, Oxford Economics' Michael Davenport says. Yet for all that, the economist expects soft core inflation, excess slack in the economy and prolonged trade policy uncertainty to keep the Bank of Canada on hold until late 2027. The bank has now left its policy rate unchanged six times running, though markets are still pricing in one quarter percentage point rise before year-end, says Davenport, who argues nearterm risks are more skewed to the downside and could lead to rate cuts if the economy stays weak and core inflation remains subdued. (robb.stewart@wsj.com, @RobbMStewart)

(END) Dow Jones Newswires

July 15, 2026 11:16 ET (15:16 GMT)

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