Bank of Canada Governor says interest rates may be high enough to control inflation

Bank of Canada Governor Tiff Macklem said interest rates may now be high enough to get inflation under control, but cautioned that the central bank needs to “stay the course” to ensure there isn’t another surge in prices. Speaking in Saint John, NB, Mr. Macklem said tight monetary policy is working and “excess demand” in the economy, which helped fuel“Interest rates may now be restrictive enough to get us back to price stability,” he said, according to the prepared text of the speech.

“But if high inflation persists, we are prepared to raise our policy rate further.” The speech also dwelled on the corrosive impact of inflation, which Mr. Macklem said “eats away at the fabric of society.” The speech comes a day after Statistics Canada reported a significant drop in inflation. Annual Consumer Price Index growth declined to 3.1 per cent in October from 3.8 per cent in September. That puts the inflation rate only slightly above the upper end of the’s 1 per cent to 3 per cent inflation control band. The bank formally targets 2 per cent inflatio

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