What comes after the carbon tax is axed?

New Prime Minister Mark Carney’s decision to effectively eliminate Canada’s consumer-facing carbon tax will shave around 0.7% from headline CPI for the next year, which could offset some of the inflationary impact from retaliatory tariffs. That said, with any impact on inflation temporary and boost to the economy small, it will not move the needle for interest rates.

This report was originally published on 28th October 2024. We are re-publishing this in light of recent developments.