{"id":17842,"date":"2025-02-21T20:08:54","date_gmt":"2025-02-21T20:08:54","guid":{"rendered":"https:\/\/torontotribune.ca\/index.php\/2025\/02\/21\/bank-of-canada-governors-tariff-warning-there-wont-be-a-bounceback-national\/"},"modified":"2025-02-21T20:08:54","modified_gmt":"2025-02-21T20:08:54","slug":"bank-of-canada-governors-tariff-warning-there-wont-be-a-bounceback-national","status":"publish","type":"post","link":"https:\/\/torontotribune.ca\/index.php\/2025\/02\/21\/bank-of-canada-governors-tariff-warning-there-wont-be-a-bounceback-national\/","title":{"rendered":"Bank of Canada governor\u2019s tariff warning: \u2018There won\u2019t be a bounceback\u2019 – National"},"content":{"rendered":"


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If Canada is hit by sweeping, broad-based tariffs from U.S. President Donald Trump<\/a>, the hit to the Canadian economy could be permanent, Bank of Canada<\/a> governor Tiff Macklem<\/a> is warning.<\/p>\n

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Speaking to the members of the Mississauga Board of Trade and the Oakville Chamber of Commerce on Friday, Macklem said the shock from the tariffs would be very different from the economic downturn caused by the COVID-19 pandemic.<\/p>\n

\u201cIn the pandemic, we had a steep recession followed by a rapid recovery as the economy reopened,\u201d Macklem said. \u201cThis time, if tariffs are long-lasting and broad-based, there won\u2019t be a bounceback.\u201d<\/p>\n

Macklem said while Canada could recover part of the growth, the damage would be long-lasting.<\/p>\n

\u201cWe may eventually regain our current rate of growth, but the level of output would be permanently lower. It\u2019s more than a shock \u2014 it\u2019s a structural change,\u201d he said.<\/p>\n

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Macklem said the first sector to feel the pinch would be Canada\u2019s export sector.<\/p>\n

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\u201cAs Canadian goods become more expensive, U.S. demand for those goods would decline. A lower Canadian dollar would provide a partial offset,\u201d he said.<\/p>\n

He said the Bank of Canada estimates an 8.5 per cent decline in the first year following broad-based tariffs, with Canadian exporters expected to respond by cutting production and laying off workers.<\/p>\n