BOC Macklem: The 2% inflation target is now in sight

The Bank of Canada’s Macklem is on the wire saying:

  • The time of rate announcements by the Bank of Canada will change to 9:45 AM ET from 10 AM, effective Jan 24, 2024; a press conference will follow every rate announcement.
  • Rate announcements by the Bank of Canada will be released 15 minutes earlier starting in 2024.
  • The deadline for the Bank of Canada’s securities repo operation will be moved to 10:15 ET from 10 AM, effective Dec 18; the timing for the release of call for tenders will also change.
  • The 2% inflation target is now in sight, though not yet achieved; conditions increasingly seem in place to reach this target.
  • Further declines in inflation are likely to be gradual due to varying influences in the coming months.
  • The next two or three quarters are expected to be difficult for many, with a likely increase in the jobless rate.
  • It’s still too early to consider cutting the policy rate; inflation has decreased but remains too high.
  • As economic growth slows, inflation pressures are expected to ease, though unexpected challenges may arise.
  • The consideration of rate cuts will occur once a clear path back to price stability is assured.
  • Economic growth is expected to remain weak into 2024, following a stall through mid-2023.
  • Shelter price inflation is expected to moderate over time, but the exact timing is uncertain.
  • 2024 is anticipated to be a year of transition, leading to a more balanced economy after a period of weakness.
  • Growth and job creation are expected to pick up later in 2024, with inflation approaching the 2% target.
  • The next few years are anticipated to be less volatile than the recent past.
  • The appropriateness and duration of restrictive monetary policy will continue to be a subject of discussion.

The USDCAD did break below the earlier floor at 1.3370 to 1.33776 (see earlier video). There is not a lot of support until 1.3319. Stay below 1.3377 keeps the sellers in firm control.

This article was written by Greg Michalowski at Source