The Bank of Canada held its overnight rate at 2.75% Wednesday, but with four more rate announcement dates on its calendar this year (July 30, Sept. 17, Oct. 29 and Dec. 10), market watchers say it’s more than likely the bank will cut the rate at on at least two of those dates, lowering borrowing costs. The notion was triggered by Bank of Canada Governor Tiff Macklem’s comment the economic environment in Canada is shrouded in “unusual uncertainty” based on whether more US tariffs will be announced, or possibly, rescinded. Sherry Cooper, chief economist at Dominion Lending Centre, told Canadian Mortgage Professional (CMP) the potential damage the tariffs could do to the economy should mean one, or more, cuts before the end of the year. “It would have been nice to see a rate cut (on Wednesday), because I do think that a weakening economy is going to turn out to have been a more serious risk than tariff-related inflation,” said Cooper. “But clearly that first-quarter GDP growth figure (up 2.2% annualized) was much stronger than expected, and that, in combination with the uptick in core inflation, has led the governing council to be very cautious.” “But I still believe that we’re going to see at least two more rate cuts this year.” .The timing of any potential cuts can’t be certain, but the bank said in its statement Wednesday it is watching “risks and uncertainties” such as a drop in demand for Canadian exports and the potential of inflation rising rapidly. Doug Porter, chief economist at Bank of Montreal (BMO) expects rate cuts are in the future, but thinks the bank is not in a hurry. “The bank is maybe a little more cautious about cutting rates than I expected, looking ahead,” he told CMP. “They’ve sounded concerned about the possibility of inflation flaring up as a result of the trade war all along, so they’ve always been a little bit on the cautious side.” “But in their forward-looking statement, it sounded like there was really no doubt in their mind about what was the correct decision on Wednesday.” “They said there was a clear consensus in the governing council to keep rates unchanged,” added Porter. “And there’s a mixed view on where rates are going next. Our view is that the bank is not finished, that there are more rate cuts ahead. But that doesn’t seem entirely obvious, at least to the governing council.” .The negative effect of the trade war should prevent a rapid increase in inflation, while energy prices are expected to remain low for the foreseeable future, said Porter. “I’m not especially concerned about inflation going ahead. The bottom line is, I still think the bank will ultimately cut interest rates more,” he said. “But it’s going to take time. The bank is in no rush to cut further.” With the next rate announcement almost two months away, the bank will be able to collect more data, including two more job reports and two more inflation readings on which to base a decision. Porter said the extra month of data will give the bank a clearer picture of economic uncertainties, adding BMO is of the mind a cut is most likely to come on July 30. As it stands, the prime lending rate will not be affected, said Penelope Graham of Ratehub.ca “The prime rate, currently at 4.95%, used by Canada’s consumer lenders will remain the same,” said Graham. “That means variable mortgage rates, which are priced based on the prime rate, won't see any change to their interest rate, their monthly payment size, the amount of their payment servicing interest, or their principal debt amount.” .Fixed rates will also remain the same. “Elevated bond yields in both the US and Canada continue to put a floor under fixed mortgage rates,” said Graham. “The Government of Canada five-year yield has remained firmly above 2.7% since mid-April, giving lenders little room to pass on further discounts.”