Bank of Canada Again Highlights Downside Risks to the Economy, Desjardins says

03:55 PM EDT, 03/26/2026 (MT Newswires) -- Carolyn Rogers, Senior Deputy Governor at the Bank of Canada, delivered a speech Thursday that was not as "overtly dovish" as the one presented last week by her boss, Governor Tiff Macklem, but she did again highlight downside risks to the economy, while not providing any clues on a near-term monetary policy response to the current oil shock, notes Tiago Figueiredo, a macro strategist at Desjardins.

Rogers delivered a speech today before the Brandon Chamber of Commerce in Manitoba.

Figueiredo said initial headlines that came across traders' screens on the speech "skewed hawkish", but he added "the limited comments on current events were far more balanced".

"Remember that just over a week ago the central bank sounded overtly dovish," Figueiredo said, noting Macklem in a statement last week, said: "With inflation close to target and the economy in excess supply, the risk that higher energy prices quickly spread to the prices of other goods and services looks contained". In today's remarks there was no mention of excess supply helping mitigate the spread of higher energy prices to other goods and services, Figueiredo said.

Figueiredo said Rogers "wasn't as direct today, but again highlighted downside risks to the economy". He noted she repeated while higher oil prices will boost income in the energy sector, increased costs will also squeeze consumers and businesses, tighten financial conditions and add more uncertainty, all of which will weigh on spending and investment. "Of course, Rogers reiterated that central bankers won't allow the oil price shock to become persistent inflation. However, that statement doesn't confer any information about any near-term monetary policy response," he said.

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