What's more important is what the Bank of Canada shared in their media presser today. Here are the key takeaways.

 Interest Rate Outlook During a Tariff War:

• The BoC is caught in a dilemma. Should it cut rates to support the economy or hike rates to control inflation? The Bank indicated the final decision will depend on which force—economic weakness or inflation—proves to be the bigger threat.

• The BoC expects tariff-driven inflation to be a one-time price increase that fades once tariffs are removed. However, if businesses raise wages to keep up with higher costs, inflation could become more persistent, making it harder to control. This would require rate increases

• A weaker Canadian dollar is inflationary as the cost to import goods will increase

 Tariffs & Inflation: A Chain Reaction

• Tariff-Driven Inflation: Higher costs on imported goods will push prices up, disproportionately hurting middle- and lower-income households.

• Risk of Persistent Inflation: If businesses raise wages to keep up with higher costs, inflation could remain elevated even after tariffs are removed.

• BoC’s Limited Power: Monetary policy (aka interest rate changes) alone cannot offset trade conflicts—government intervention may be necessary.

 Money Supply & Capital Misallocation

• A stimulus package could inject excess liquidity into the economy, but where the money flows is critical.

• Real estate and stocks could absorb some of this liquidity, inflating asset prices rather than boosting productivity. We've seen this happen during the pandemic

• Low interest rates and more money supply encourage speculative investments, potentially leading to outsized price growth in assets

• Potential for Abuse: As seen during the pandemic, there is a risk of bad actors exploiting these programs for financial gain, diverting resources from those in need.

 Wealth Redistribution & Market Distortions

• If relief funds go to lower- and middle-income households, much of the money will be spent on essentials (rent, groceries), ultimately benefiting businesses and landlords.

• Meanwhile, wealthier individuals reinvest gains into assets, widening the wealth gap.

• This feedback loop drives further inflation in real estate, pricing out first-time buyers and worsening affordability.

 Impact on the Housing Market

The Bank of Canada faces tough choices between supporting the economy and controlling inflation amidst trade uncertainties. Real estate professionals should watch for potential price inflation and affordability challenges, as stimulus measures and tariff impacts could drive liquidity into assets like housing.