Bank of Canada likely to add labour-market conditions to inflation mandate, CIBC says

  • 📰 nationalpost
  • ⏱ Reading Time:
  • 40 sec. here
  • 2 min. at publisher
  • 📊 Quality Score:
  • News: 19%
  • Publisher: 80%

United States News News

United States United States Latest News,United States United States Headlines

The move could mean a slower interest rate-hike trajectory

Banks more vulnerable to economic shocks due to decline of government-backed mortgage insurance, Moodys finds

Shenfeld said the additional emphasis on the labour market could have implications on monetary policy. Since there’s plenty of uncertainty around what full employment actually looks like, the central bank will be more open to the idea of testing the limits of the economy. “If you don’t know where full employment lies, the only way to find out is to give yourself time to explore lower jobless rates and observe how wage and price inflation respond,” he said. “That suggests starting to hike a bit earlier, but taking a slow enough path to give the labor market a chance to show its true colours at progressively lower unemployment rates.”

Swaps trading suggests investors are betting the Bank of Canada will raise borrowing costs seven times over the next 12 months.

 

Thank you for your comment. Your comment will be published after being reviewed.
Please try again later.
We have summarized this news so that you can read it quickly. If you are interested in the news, you can read the full text here. Read more:

 /  🏆 10. in US

United States United States Latest News, United States United States Headlines