The looming threat of potential U.S. tariffs is keeping economists and monetary policymakers up at night. In this episode, RBC Economics’ Claire Fan and Carrie Freestone break down:

-How RBC Economists are thinking about a U.S. tariff shock- including the multiple stages of passthrough to the economy.

-How we think the Bank of Canada could respond to higher prices resulting from tariffs.

-Why “reshoring” isn’t as easy as it sounds.

Tune in to hear why tariffs are demand-destructive and to understand the Bank of Canada’s predicament if required to respond to these policy-induced price-shifts. While we highlight that the economic damage is likely too severe for these threats to materialize, we also discuss what the consequences would be for the U.S. and Canada if tariffs are implemented.