The Bank of Canada recently lowered its policy rate, making it three cuts in a row.
bank of canada
In recent decades, central banks have fought inflation using interest rates instead of monetary growth.
Annual inflation peaked at 8.1 per cent in June 2022, well above the bank’s 2 per cent target.
The government's debt-to-GDP ratio has risen consistently since 2015.
Even after inflation is brought to heel, Canadians should not expect interest rates to return to pre-pandemic levels.
Reductions in purchasing power tend to be concentrated among lower-income workers.
Other central banks publish a projected interest rate path consistent with their economic outlook—not so in Canada.
Ottawa is spending nearly one-third more than it was in 2019 before the pandemic.
The central bank has acknowledged that it underestimated the inflationary effects of its actions.
The Bank of Canada's “easy” policies help explain the current pain at the pumps.