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BMO sees long-term economic damage even from optimistic tariff scenario
BMO forecasts a long-term U.S. tariff impact reducing GDP by 1.5% to 5%, with potential near-term recession under worst-case scenarios.
- A report by The Canadian Press, published on October 6, 2025, analyzed BMO’s projections for the economic impact of U.S. tariffs on Canada.
- BMO’s analysis came amid ongoing tariff disputes, with expectations that discussions this week between Canada’s prime minister and the U.S. president could result in steel tariff reductions.
- The BMO report modeled three scenarios, including a base case reflecting current U.S. policies, a middle scenario involving 15 per cent tariffs, and a worst case of 35 per cent.
- According to BMO, their baseline scenario projects a 1.5 per cent decrease in long-term GDP, while in the most severe scenario, economic growth could be reduced by as much as five per cent.
- BMO chief economist Douglas Porter indicated that even in the most optimistic case, Canada already faces significant growth losses.
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BMO Sees Long-Term Economic Damage Even From Optimistic Tariff Scenario
A new report looking at some possible paths ahead for U.S tariffs finds that even the base case could mean a 1.5 percent drop in long-term GDP, while a worst case could cut five percent off growth. The report from BMO looked at three scenarios, including a benign case that reflects current U.S. policies, which the bank figures has resulted in about a seven percent effective tariff on Canadian goods. The benign base case would likely mean only a …
·New York, United States
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Even the favourable scenario would lead to a 1.5% reduction in GDP in the long term. The post Tariffs: an inevitable drop in GDP, according to BMO appeared first on Les Affaires.
Coverage Details
Total News Sources6
Leaning Left1Leaning Right2Center1Last UpdatedBias Distribution50% Right
Bias Distribution
- 50% of the sources lean Right
50% Right
L 25%
C 25%
R 50%
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