Macklem said policymakers would lean heavily on medium‑ and longer‑term expectations, typically over three to five years, when deciding whether further rate hikes are needed this year.
The Bank of Canada is set to release its Business Outlook Survey and consumer expectations survey on Monday, offering fresh evidence on how firms and households are thinking about prices, wages and spending.
Money markets have swung between betting on a 25‑basis‑point and a 75‑basis‑point move later this year as the Iran conflict lifted oil and natural gas prices, feeding into gasoline and food costs.
Falling headline CPI below 2% helped cool inflation expectations and opened the door to rate cuts, while the Iran‑driven oil shock has complicated that path and forced the Bank to lean on judgment at its last 2.25% rate hold.
At the same time, business and CEO surveys have pointed to subdued sentiment, soft sales expectations and cautious investment plans, even as inflation pressures eased.