Data out Friday turned up the heat on central banks not only here, but also south of the border.and revealed that the tight labour market was putting pressure on wages.
The Bank faces a hard choice in light of this new data, wrote Carlos Capistran of BofA Global Research, who expects a 50 basis point hike in July, but says the risk of a 75 point hike has increased. A half-point hike is widely expected when the Fed meets this week and another in July, following the 50-basis point hike in May. In just three months that is more policy tightening than the U.S. Federal Reserve did in all of 2018, says Reuters.
But as central banks scramble to make up for keeping policy too loose for too long, some worry they will swing too far in the other direction, risking even more damage. What this adds up to, the Bank’s risk assessment concludes, is that the probability of the economy contracting in the first quarter of 2024 is nearly two times greater than before the pandemic.
Small, systematic adjustments were warranted long ago but didn't align with the federal Liberal campaigns. Now, after much delay and the build up of deficit driven inertia, rate corrections with either be substantial or ineffective.
How have we ended up w such utterly incompetent bureaucrats & politicians - to the PMs office & the Governor of the bankofcanada? 10s of 1000s will end up losing their homes. Oh no, stop me - theJagmeetSingh will make TAXPAYERS pay their mortgages!
Huzzah
Inflation is typically caused by either increased consumer demand in a strong economy or by supply shortages driving prices higher. The pandemic disrupted supply chains and the war in Ukraine exacerbated problems.
When my bank raised my savings rate by 1.5 points last week to 2.65% I figured this was coming. They wouldn't do that if the BofC rate was just jumping 1/2 point.
Cut out the carbon tax it affects many goods and services it just not real estate and if they do raise there will be many people who will crash this won’t end well
Thank a liberal near you.
5% rates on mortgages will start to hit the fan.
this is a banded for bleeding the inflation. So when they are starting to stop printing the money!!!
LolololoBank of Canada
Government should intervene and stop Bank of Canada from this madness. If interest rates keep on going up, it can lead to housing market crash and recession. People are already struggling to make monthly mortgage payments. housingmarket Toronto cdnpoli onpoli
Planned …bankrupting Canadians purposely. You’ll own nothing and be happy
Reason they have to raise so aggressively is because JustinTrudeau printed 20% of ALL CAD $ in 2 years. He borrowed and wasted much of it. So they have to raise interest rates to control inflation. They have to raise so much, so fast b/c inflation is so high. Mostly JTs fault
Yay! This does nothing to curtail that printer you've still yet to shut off. Or is the BoC still denying basic economic principles that printing more money causes inflation?
Bank of Canada is in unchartered waters of unchecked fire-the inflation-too late to extinguish it now-but will drown all of us-whole of Canada-financially/Economically?
Who cares what the bankofcanada does, or does not do, when debt is already priced it way more than BoC says. Bond vigilantes - or just lack of credibility. The BoC is no where near leading anymore, but playing catch up as markets force it to more.
Bank of Canada for years,by its historically aberrant near-zero interest rate policy,destroyed savers' ability to earn money,while helping create the housing crisis that's made a basic human need,affordable housing, into a luxury,seriously degrading quality of life for millions
So, PierrePoilievre was right all along?
Geez the whole world is going through the exact same crisis and here we are blaming the right and the left🤦♂️
Good thing Trudeau just gave a hundred million to Latin America. What a national disgrace.
My bet is on a 1% hike.
Oh that’ll help. I’m sure forcing people already stretched paying for essentials to tighten over tight belts more won’t hurt the average Canadian. When will government admit that IT is the problem not the solution? Free people including their productivity are the answer.
10 by Oct... 🤔
This should be the 1 issue for the rightie leaders. What would they do with interest rates, why and how would they do it. No whining, no complaining, just what, why and how. Rising interest rates are killing a lot of us.
I think the BOC is in deeper than it wants to admit. If you assume the Ontario economy is the engine and the engine is firing on all cylinders with full tank of gas ($100 billion in infrastructure spending in the next decade), then rates will need to rise much higher …
Beginning of the end for the central banks and this government...
Regardless of BOC policy we're headed for a DEEP recession/depression. Anybody saying otherwise is lying. You can't pump unproductive liquidity into a market for 2 years and expect business as usual. Central banks should have tightened money supply during Covid, not loosened it
Increasing interest rates increases “my” personal inflation,does not reduce it.
Raise it!
Canada is broke. 🇻🇳🇻🇳🇻🇳
Yay recession! Good thing Trudeau borrowed all that money to spike the housing market so it can fall and put everyone in negative equity!
This guy is incompetent- he should have raised rates last year, the horse has left the barn. He is just going to cause a recession.
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