Buyer Activity Increases Slightly in JulyGreater Toronto Area (GTA) home sales in July 2024 were up compared to July 2023. While sales were up from last year, buyers continued to benefit from more
Bank of Canada 'getting closer' to raising rates, says Macklem
Dated: November 16 2021
Views: 239
Bank of Canada Governor Tiff Macklem said his central bank is “getting closer” to raising interest rates as slack in the economy dissipates, in line with the forward guidance officials have been providing all along.
While substantial monetary stimulus is still needed in order for the economy to fully recover, Macklem said his team remains focused on its inflation target at a time when risks associated with price pressures have increased.
“For the policy interest rate, our forward guidance has been clear that we will not raise interest rates until economic slack is absorbed,” Macklem wrote in an opinion piece for the Financial Times published Monday. “We are not there yet, but we are getting closer.”
The language in the article is consistent with recent efforts by the Bank of Canada policy makers to reassure Canadians they are serious about inflation, including a decision last month that saw officials bring forward the timeline for possible interest rate increases to early next year.
That policy decision was more hawkish than expected and caught some market players by surprise, but Macklem said the move is in line with the central bank’s communications throughout the pandemic.
“As for our forward guidance on the policy interest rate, we were clear from the outset that it was based on an outcome,” the governor said.
Macklem reiterated that the Bank of Canada’s view is still that recent inflationary pressures will ease. Yet, he acknowledged there remains a high level of uncertainty. “Supply disruptions appear to be lasting longer than we thought, and energy price increases are adding to current inflation rates.”
He said the Bank of Canada will adjust policy if needed, depending on the inflationary pressures.
“While our analysis continues to indicate that these pressures will ease, we have taken them into account for the dynamics of supply and demand,” Macklem said. “What our resolve does mean is that if we end up being wrong about the persistence of inflationary pressures and how much slack remains in the economy, we will adjust.”
Ross Macdonald
"Adding Real Value to Our Neighbourhood” is our Groups motto. It is the Mission of our Team to create an unparalleled client experience resulting in a stress free buying and selling transition. Ro....
Latest Blog Posts
First-time buyers relying on gifted down payments more than everMortgage down payment gifts from family members remain a crucial factor for first-time homebuyers in Canada, even as the housing
Condo rents in Toronto region dip for first time in 3 years: UrbanationA new report says condo rents in Canada's mostly densely populated region have dipped for the first time in three years.The
Bond yields fall to 2-year lows, more rate cuts to followBond yields plummeted late last week as economic instability prompted investors to seek the safety of bonds.This surge in demand drove
Toronto Real Estate Board (TRREB); All information deemed reliable but not guaranteed. All properties are subject to prior sale, change or withdrawal. Neither listing broker(s) or information provider(s) shall be responsible for any typographical errors, misinformation, misprints and shall be held totally harmless. Listing(s) information is provided for consumer's personal, non-commercial use and may not be used for any purpose other than to identify prospective properties consumers may be interested