The Financial Post reports in its Saturday edition that Scotiabank vice-president Derek Holt says retaliation against United States tariffs could hold the key to Bank of Canada's moves on interest rates. The Post's Gigi Suhanic writes that Mr. Holt said in a note: "U.S. tariffs with no retaliation would mean more easing by the Bank of Canada. U.S. tariffs with material retaliation by Canada could thwart easing and even bring back policy tightening." Mr. Holt said in an interview: "It's hard to have conviction on the path forward for the [BOC] because of this tariffs issue. If we don't get tariffs, then our baseline assumption is that maybe we get another quarter- or half-a-point worth of rate cuts." The BOC's benchmark lending rate currently stands at 3.25 per cent, which is at the top of its neutral range of 2.25 per cent to 3.25 per cent. Mr. Holt said: "We're at 3.25 now. Maybe we go down to 3 or 2.75, somewhere in that range, but we're pretty close to where we think you would be balancing conditions and the overall economy." If Donald Trump's tariffs land and Canada does not retaliate, then Mr. Holt thinks the BOC will have to start cutting rates and by a sizable amount, perhaps even into the 1 per cent range.