The July 2025 Monthly Forecast Update from RBC Economics includes a forward-looking analysis of Canadian, US and international financial market trends.
Highlights
“With one of the lowest tariffs now thanks to CUSMA exemptions, Canada is relatively well positioned for future competition among US trade partners.”
—RBC Monthly Forecast Update
- Tariff impacts on inflation and the labour market in the United States are delayed slightly but won’t be prevented, leading to a pushback in the start of the Federal Reserve’s rate cutting timeline from September to December.
- With tariffs applied only to non-USMCA compliant goods, a material change to the Canadian economic outlook is not expected.
- Fiscal support from Canadian federal and provincial governments is increasing and adding upside to the growth outlook—although more so in 2026 and beyond.
- The Canadian unemployment rate is still expected to hit a peak soon. Job openings are stabilizing, signalling steadying hiring demand and limited further deterioration in the labour market.
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