Macquarie Economist Sees Bank of Canada on Hold Wednesday, But Predicts 25bps Rate Hike in September

07:05 AM EDT, 06/09/2026 (MT Newswires) -- The Bank of Canada rate decision is scheduled for Wednesday at 9:45 a.m. ET, said David Doyle, head of economics at Macquarie Group.

Doyle's base case is for a hold with the Overnight rate likely to remain at 2.25%.

Since April's decision, market pricing has moderated significantly as domestic economic data have generally surprised on the downside, stated the economist. Forward guidance is likely to continue to suggest a hiking bias, reflecting greater concern about inflation.

The BoC is likely to downplay the importance of the recent Q1 real gross domestic product contraction and the discussion of a technical recession in the media, especially given a strong preliminary estimate for April, according to Doyle.

Messaging on this is likely to be emboldened by the strength apparent in the Labour Force Survey (LFS) for May.

Macquarie continues to see the next policy move as a rate hike, but suspects this will only come later this year in the context of labor market improvement and still elevated inflation.

Doyle's base case is for two hikes of 25 bps each, with the first one occurring in September 2026.

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