balanced fund quarterly report
September 30, 2025
Economic Commentary
Both the Bank of Canada and the U.S. Federal Reserve lowered interest rates by 25 bp at their meetings in September. This marked the first decrease in interest rates by the Bank of Canada since March of this year. The last rate cut by the U.S. Federal Reserve was in December 2024. Fed Chair Powell described this latest cut as a risk management tool as the Fed attempts to balance the risk between a weaker labour market and the threat of higher inflation due to the impact of the global trade tariffs. Powell’s comments following the meeting were somewhat hawkish as he indicated the Fed would be cautious going forward and that any future rate cuts would be data dependent and would be addressed on a meeting-to-meeting basis. Economic projections are forecasting two more rate cuts in the U.S. by the end of the year. Bank of Canada governor Tiff Macklem was also non-committal with respect to future interest rate cuts as their latest statement omitted reference to further easing, which had been included in their comments following their previous meeting.
President Trump’s ongoing attempts to try and influence U.S. Federal Reserve monetary policy continued, stating that the Fed needs to cut rates soon and that Chair Powell has been too slow to react to market conditions. Trump also attempted to fire a Fed governor, a decision that the Supreme Court will address in January 2026. Independence of the U.S. Federal Reserve is critical to the stability of global financial markets.
