09:24 AM EDT, 03/13/2025 (MT Newswires) -- Accompanying Wednesday's Bank of Canada rate decision announcement were preliminary results of its consumer and business sentiment surveys, noted Bank of Montreal (BMO).

While the full results will be out in April, they're based on

responses collected from the end of January to early/mid

February, just as United States tariff threats on Canada ramped up, noted the bank.

Indeed, trade uncertainty weighed on: household spending plans, job security concerns (especially in the trade-sensitive sectors), and business hiring and investment plans.

More concerningly for inflation, about half of firms plan to

pass some portion of tariff costs through to their consumers, pointed out BMO.

It's pushing inflation expectations up: almost half of businesses plan to charge higher prices, while over 70% of households expect a higher cost of living, based on the trade environment.

Time will tell what will have a bigger impact between the

inflation-boosting and growth-dampening effects of the

trade war, stated the bank.

For now, BMO believes the latter will overwhelm the

former and are calling for three more cuts from the BoC at

the next three meetings.