The Globe and Mail reports in its Thursday edition that on Wednesday, the Bank of Canada cut its policy rate by 25 basis points to 2.5 per cent, a move expected by markets. The Globe's guest columnists Jeremy Kronick and Steve Ambler write that the Canadian economy shows significant stress, with GDP contracting at an annualized pace of 1.6 per cent in the second quarter, raising recession concerns. Per capita GDP has stagnated or contracted in nine of the past 12 quarters. Exports fell 30 per cent annualized, while imports decreased by 5 per cent, following the earlier boost from front-running tariffs. Employment has fallen by over 100,000 positions in July and August, impacting full-time jobs for prime working-age people. The unemployment rate reached 7.1 per cent in August, the highest since 2016, excluding the pandemic. This fall in employment is widespread across various sectors. Service inflation, the main driver of overall inflation, fell from 3 per cent in June to 2.8 per cent in July and August, with a slight drop between those months, reflecting economic weakness beyond the goods sectors. Prime Minister Mark Carney's decision not to retaliate against U.S. tariffs will work to bring inflation down further.