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TD Says Better-Than-Expected Labor Report Cements Its Bank of Canada Hold Forecast for This Week

BY MT Newswires | ECONOMIC | 08:52 AM EST

08:52 AM EST, 12/09/2025 (MT Newswires) -- The Bank of Canada will hold its final policy decision of the year on Wednesday, with the statement out at 9:45 a.m. ET, said TD.

Before November's employment report, it was already expected that interest rates would stay unchanged, and last Friday's Labour Force Survey (LFS) confirms this view, noted the bank.

More important is how the Governing Council guides the outlook, stated TD. It's likely to recognize progress in employment while highlighting ongoing slack in the labor market and considerable uncertainty, especially as Canada and the United States enter complex USMCA trade deal renegotiation talks.

The bank also expects the BoC will reaffirm that inflation will continue moderating. All told, TD forecasts the BoC to maintain its current stance through 2026 and continue to look for signs that a sustained economic recovery is in the works.

The bank will finally get an update on how Canada's exports are faring in the face of U.S. tariffs, as Statistics Canada will publish September's international trade data on Thursday, it added. Trade data was delayed due to the U.S. government shutdown, with October and November's data to be released in January.

MT Newswires does not provide investment advice. Unauthorized reproduction is strictly prohibited.

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