Bank of Canada’s Rate Reduction Amid Trade Tensions
On October 29, 2025, the Bank of Canada announced a reduction in its target for the overnight rate by 25 basis points, bringing it down to 2.25%. This decision comes as the impact of U.S. trade policies on both the global and Canadian economies becomes increasingly apparent. The bank has resumed providing projections for economic performance, following a period of uncertainty.
According to the latest Monetary Policy Report (MPR), while the global economy has shown resilience against the unprecedented rise in U.S. tariffs, the ramifications are now being felt. Trade relationships are undergoing significant reconfiguration, and persistent trade tensions are stifling investment across many nations. Within Canada, the MPR outlines a challenging transition for the economy, indicating that the structural damage inflicted by ongoing trade conflicts has curtailed the economy’s capacity and increased costs. This situation constrains the effectiveness of monetary policy in stimulating demand while maintaining low inflation. The Bank is intent on preserving consumer confidence in price stability amid this turbulent global landscape.
The next update regarding the overnight rate is scheduled for December 10, 2025, with the following MPR to be disclosed on January 28, 2026.
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In parallel with these economic shifts, Canada’s environment sector is actively pursuing an energy transition. Construction has commenced on a historic project: the Skyview 2 Battery Energy Storage System, which is set to become the most extensive battery storage facility ever procured in Canada. Once operational, this facility will possess the capacity to power nearly 400,000 homes, thereby reinforcing Ontario’s electricity grid. This advancement not only aims to bolster energy security but also supports the development of a more competitive and self-sufficient provincial economy.
In Hot Sector News, we highlight NextStar Energy, Canada’s inaugural large-scale lithium-ion battery manufacturing facility. This Windsor-based company is broadening its operations to include the production of energy storage system (ESS) batteries. Starting this month, NextStar will manufacture advanced battery cells specifically designed for commercial and grid-scale energy storage solutions, marking a pivotal move towards sustainable energy innovation in Canada.
“NextStar Energy’s expansion into energy storage reflects the company’s ability to respond and adapt to changing markets,” stated Danies Lee, CEO of NextStar Energy, a collaboration between LG Energy Solution and Stellantis. “By adding to our portfolio, we are not only demonstrating our resilience and flexibility as a company, but also our commitment to sustainable innovation, and a lasting footprint here in Windsor.”
The ESS market is projected to grow significantly over the next decade, largely due to the demands of artificial intelligence data centers and the increasing need for grid stability.
NextStar Energy’s expansion will introduce a new battery chemistry—Lithium Iron Phosphate (LFP)—which is particularly suited for various battery applications, especially in conjunction with the existing Nickel Manganese Cobalt (NMC) chemistry used in electric vehicles. This strategic decision positions NextStar to effectively meet the growing demands of both the ESS and EV battery markets, in alignment with the needs of its joint venture partners.
“Our workforce is a key factor in our ability to expand our business,” Lee elaborated. “With a world-class team that prioritizes quality, safety, and innovation, we have not only achieved but exceeded milestones leading up to the start of production, establishing NextStar as a reliable and competitive entity on a global scale.”
NextStar has been diligently conducting equipment calibration and material testing, with mass production set to commence in the coming weeks. The company has already onboarded over 1,000 employees, many of whom have undergone specialized training through programs like Battery Boost, developed in collaboration with Invest WindsorEssex and Palette Skills. This program employs advanced virtual reality simulations to prepare technicians for real-world operations.
Monitoring Cleantech Stocks
As we observe developments in the cleantech sector, here are some Canadian stocks currently on our radar:
| Name | Symbol | Price in $CDN Oct. 15/25 |
Price in $CDN Nov. 14/25 |
% Change |
| Algonquin Power & Utilities Corp. | AQN | $8.23 | $8.52 | +3.52% |
| Anaergia Inc. | ANRG | $2.78 | $2.43 | -12.59% |
| Ballard Power Systems Inc. | BLDP | $4.02 | $4.25 | +5.72% |
| *BIOREM Inc. | BRM | $1.90 | $2.15 | +13.16% |
| BluMetric Environmental Inc. | BLM | $1.29 | $1.43 | +10.85% |
| Boralex Inc. | BLX | $28.54 | $26.62 | -6.73% |
| *CHAR Technologies Limited | YES | $0.21 | $0.20 | -4.76% |
| Electrovaya Inc. | ELVA | $10.33 | $6.65 | -35.62% |
| Engine No 1 (Transform ETF) | NETZ | $109.67 | $110.81 | +1.04% |
| EverGen Infrastructure Corp. | EVGN | $0.61 | $0.46 | -24.59% |
| Greenlane Renewables Inc. | GRN | $0.27 | $0.27 | 0% |
| Loop Industries | LPEN | $1.96 | $1.60 | -18.37% |
| Northland Power Inc. | NPI | $24.80 | $18.20 | -18.61% |
| Tantalus Systems | GRID | $3.70 | $3.80 | +2.71% |
| *Thermal Energy International Inc. | TMG | $0.15 | $0.12 | -20.00% |
| Westport Fuel Systems Inc. | WPRT | $3.07 | $2.36 | -10.10% |
| Zinc8 Energy Solutions Inc. (Abound Energy) | ZAIR | $0.040 | $0.045 | +12.50% |
*The authors of this column own equity. This is not an endorsement but a statement of fact.
As Canada navigates through economic challenges, the country’s advancements in clean technology and energy storage may be key to achieving a more sustainable future.
