Reuters reports the Bank of Canada Governor Tiff Macklem saying on Wednesday that Canada needs higher interest rates, though how high those rates go will depend on how the economy responds and how the outlook for inflation evolves.
BoC raises policy rate to 1% to battle inflation
BOC'S MONETARY STIMULUS
The Bank of Canada Governor Senior Deputy Governor Carolyn Rogers says the labour market is a really strong indicator right now of excess demand in the Canadian economy.
BoC Governor Macklem reiterated that interest rates in Canada will need to be lifted, noted that inflation is too high and said it going to be elevated for longer than we previously thought, reported Reuters.
BOC event related news
BOC event related analysis
November BoC meeting review
The BoC left rates on hold, but they ended QE and brought rate guidance forward to the middle quarter of 2022 from sometime in the second half of 2022. This move was supportive for the CAD and should continue to be over the medium term as long as oil prices don’t collapse.
October BoC meeting review
So, QE ended (so far in Canada, but the Fed will follow suit) and the termination plunged gold prices in Canadian dollars. Will this repeat globally?
Today's BoC monetary policy announcement was much more hawkish than expected. The BoC ended its quantitative easing program with immediate effect, and also signaled that policy interest rates could start rising earlier than previously expected.
What is the BOC?
The Bank of Canada is the nation's central bank. Its principal role is "to promote the economic and financial welfare of Canada," as defined in the Bank of Canada Act. The Bank’s four main areas of responsibility are:
- Monetary policy: The Bank influences the supply of money circulating in the economy, using its monetary policy framework to keep inflation low and stable.
- Financial system: The Bank promotes safe, sound and efficient financial systems, within Canada and internationally, and conducts transactions in financial markets in support of these objectives.
- Currency: The Bank designs, issues and distributes Canada’s bank notes.
- Funds management: The Bank is the "fiscal agent" for the Government of Canada, managing its public debt programs and foreign exchange reserves.
Who is BOC's president?
Tiff Macklem was born in Montréal, Quebec, in 1961. He was appointed Governor of the Bank of Canada, effective 3 June 2020, for a seven-year term. He is the tenth governor of the Bank of Canada. As Governor, he is also Chairman of the Board of Directors of the Bank for International Settlements (BIS). He currently chairs both, the BIS Audit Committee and the Consultative Council for the Americas.
Interest rates latest news
the world interest rates table
The World Interest Rates Table reflects the current interest rates of the main countries around the world, set by their respective Central Banks. Rates typically reflect the health of individual economies, as in a perfect scenario, Central Banks tend to rise rates when the economy is growing and therefore instigate inflation.