Canada’s hotter-than-expected inflation reading sets stage for another rate hike
When Canada first embarked on its path to a more “durable” path to a more resilient economy (p. 7), it was met with a mixture of skepticism, caution, cynicism and anger.
The government’s path to fiscal health was predicated on the idea that the economy would be capable of bouncing back from higher rates of inflation and higher interest rates.
The economy was deemed to be in good shape. A strong Canadian dollar was projected to keep an economy whose output was already growing at a healthy pace robust.
Unfortunately, the first few years of the new Canadian economic plan were met with a string of warning signs that the Canadian economy was a prime example of a long list of problems in the emerging world. Not only was the Canadian economy faltering (p. 6), the Canadian dollar had fallen, inflation was a problem, manufacturing was failing, consumer confidence was faltering, and the global economy was in a funk (p. 7).
However, the Canadian economy’s path to a more “durable” path to a more resilient economy was predicated on the idea that the Canadian economy would be capable of bouncing back from higher rates of inflation and higher interest rates.
Despite warnings of higher inflation and higher interest rates, the country’s central bank was optimistic. The Bank of Canada was optimistic.
The Canadian economy’s path to a more “durable” path to a more resilient economy was predicated on the idea that the Canadian economy would be capable of bouncing back from higher rates of inflation and higher interest rates.
Unfortunately, the first few years of the new Canadian economic plan were met with a string of warning signs that the Canadian economy was a prime example of a long list of problems in the emerging world. Not only was the Canadian economy faltering (p. 6), the Canadian dollar had fallen, inflation was a problem, manufacturing was failing, consumer confidence was faltering, and the global economy was in a funk (
