Connect with us

Hi, what are you looking for?

World News

Canada’s economy has scope to slow with ‘exceptionally high’ vacant jobs — central bank gov

TORONTO — Bank of Canada Governor Tiff Macklem said there is scope to slow the economy based on an “exceptionally high number” of job vacancies in the labor market.

In an interview aired on CBC Radio on Sunday, Mr. Macklem said the current inflation fight is the biggest test the central bank has faced since it started targeting inflation 30 years ago.

But he assured Canadians that monetary policy is working and he expected inflation to return to the central bank’s 2% target by 2024. Canada’s headline inflation rate dropped to 7.0% in August, with core inflation running at about 5%.

“We need to cool the economy, (but) we don’t want to over-cool the economy,” Mr. Macklem said.

“When we look at the economy right now, there is an exceptionally high number of vacant jobs … that’s a clear signal that there is scope to slow the economy, without a lot of people put out of work,” he added.

Canadian employers were actively looking to fill nearly 1 million jobs as of July, data released on Friday showed, while the job vacancy rate dropped to 5.4% in July, from a peak 6.0% in April 2022.

The Bank of Canada has raised its benchmark interest rate by 300 basis points since March, one of its steepest and fastest tightening cycles ever. Economists and money markets are leaning toward a 50-basis-point increase on Oct. 26.

Mr. Macklem said parts of the economy that are sensitive to interest rate increases are starting to slow.

“Let me be clear, what we don’t want is … inflation and wages to become unmoored to our 2% objective, because if that happens, then we are actually going to need to slow the economy a lot more to get the inflation back to 2%. That’s what we have been what we call front-loading our interest rate increases,” Mr. Macklem added. — Reuters

    You May Also Like

    Business

    The head of the International Monetary Fund has warned of increased risks to the stability of the financial system after weeks of banking sector...

    Business

    1.22 billion people use Instagram every month. That’s a huge number of Instagrammers trying to hit it big on the platform all at the...

    Business

    The Home Office has made next to no progress in tackling criminal fraud during the past five years, despite it having become Britain’s most...

    Business

    Since the rise of online casinos, cybersecurity has become a major concern for both casino operators and players alike. The transactions that go around...

    Disclaimer: rightdecisionnow.com, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

    Copyright © 2023 rightdecisionnow.com | All Rights Reserved