The September 2025 Monthly Forecast Update from RBC Economics includes a forward-looking analysis of Canadian, US and international financial market trends.
Highlights
“Economic data is increasingly showing the sting from tariffs. In Canada, there are reasons to expect the worst of the drag from trade is likely behind us.”
—RBC Monthly Forecast Update
- Evidence of economic damage from trade protectionism is piling up—but in Canada, there is reason to believe the worst effects of tariffs are in the rear view.
- Labour markets have softened in Canada and the United States at a pace in line with previous assumptions.
- Odds of additional easing from the Bank of Canada have risen but further reductions aren’t expected.
- “Stagflation lite” is expected to persist in the United States as inflation and the unemployment rate both rise into year-end.
- A shift in tone from the Federal Reserve means US interest rate cuts are likely to come sooner than expected.
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