The Bank of Canada Governor Tiff Macklem recently testified before the Standing Committee on Finance and had some key takeaways to share. He began by saying that if evidence begins to accumulate to show that inflation is not declining in line with forecast, they are prepared to raise policy rate further.
Macklem then proceeded to share his takeaways. He said, “We’ve seen some evidence that our interest rate increases are starting to slow demand and rebalance our overheated economy.” He further added that with inflation above 6%, they are still a long way from the 2% target, but inflation is turning the corner. He also noted that the Canadian economy remains overheated and clearly in excess demand, and this continues to put upward pressure on many domestic prices.
The Governor also provided some projections. He said that they expect CPI inflation to fall to around 3% in the middle of this year and reach the 2% target in 2024. He also warned that global energy prices could jump again, pushing inflation up around the world.
In terms of the market reaction, USD/CAD showed no immediate reaction to these comments and was last seen trading at 1.3460, where it was up 0.5% on a daily basis.
The Bank of Canada Governor, Tiff Macklem, recently testified before the Standing Committee on Finance and shared his key takeaways on inflation. He began by saying that if evidence begins to accumulate to show that inflation is not declining in line with forecast, they are prepared to raise policy rate further.
Macklem then went on to explain that they are seeing evidence that their interest rate increases are starting to slow demand and rebalance the overheated economy. He noted that with inflation above 6%, they are still a long way from the 2% target, but inflation is turning the corner. He added that the Canadian economy remains overheated and clearly in excess demand, and this continues to put upward pressure on many domestic prices.
The Governor also provided some projections. He said that they expect CPI inflation to fall to around 3% in the middle of this year and reach the 2% target in 2024. He warned that global energy prices could jump again, pushing inflation up around the world.
In terms of the market reaction, USD/CAD showed no immediate reaction to these comments and was last seen trading at 1.3460, where it was up 0.5% on a daily basis.
The Bank of Canada has been taking steps to ensure that inflation stays within the target range of 2%. Governor Tiff Macklem recently testified before the Standing Committee on Finance to discuss the Bank of Canada’s policy on inflation and the current state of the economy.
Macklem began by saying that if evidence begins to accumulate to show that inflation is not declining in line with forecast, they are prepared to raise policy rate further. He then went on to explain that they are seeing evidence that their interest rate increases are starting to slow demand and rebalance the overheated economy. He noted that with inflation above 6%, they are still a long way from the 2% target, but inflation is turning the corner. He added that the Canadian economy remains overheated and clearly in excess demand, and this continues to put upward pressure on many domestic prices.
The Governor also provided some projections. He said that they expect CPI inflation to fall to around 3% in the middle of this year and reach the 2% target in 2024. He warned that global energy prices could jump again, pushing inflation up around the world.
Macklem concluded by stressing that the Bank of Canada is prepared to take further action if needed. He said that they are monitoring the situation closely and will take appropriate action if necessary.
In terms of the market reaction, USD/CAD showed no immediate reaction to these comments and was last seen trading at 1.3460, where it was up 0.5% on a daily basis.
The Bank of Canada Governor Tiff Macklem recently testified before the Standing Committee on Finance and shared his key takeaways on inflation. He began by saying that if evidence begins to accumulate to show that inflation is not declining in line with forecast, they are prepared to raise policy rate further.
Macklem then proceeded to share his takeaways. He said, “We’ve seen some evidence that our interest rate increases are starting to slow demand and rebalance our overheated economy.” He further added that with inflation above 6%, they are still a long way from the 2% target, but inflation is turning the corner. He also noted that the Canadian economy remains overheated and clearly in excess demand, and this continues to put upward pressure on many domestic prices.
The Governor also provided some projections. He said that they expect CPI inflation to fall to around 3% in the middle of this year and reach the 2% target in 2024. He also warned that global energy prices could jump again, pushing inflation up around the world.
Macklem concluded by stressing that the Bank of Canada is prepared to take further action if needed. He said that they are monitoring the situation closely and will take appropriate action if necessary. He also noted that the Bank of Canada is ready to take additional measures, such as increasing policy rates, if needed to keep inflation in check.
In terms of the market reaction, USD/CAD showed no immediate reaction to these comments and was last seen trading at 1.3460, where it was up 0.5% on a daily basis. This suggests that the market is not expecting any further rate hikes from the Bank of Canada in the near future.
Overall, Governor Tiff Macklem’s testimony before the Standing Committee on Finance highlighted the Bank of Canada’s commitment to keeping inflation within the target range of 2%. He noted that they are seeing evidence that their interest rate increases are starting to slow demand and rebalance the overheated economy. He also provided projections that CPI inflation is expected to fall to around 3% in the middle of this year and reach the 2% target in 2024. Finally, he stressed that the Bank of Canada is ready to take additional measures, such as increasing policy rates, if needed to keep inflation in check. The market reaction to these comments was muted, with USD/CAD trading at 1.3460, up 0.5% on a daily basis.
