BoC Governor Tiff Macklem told the Senate banking committee yesterday that inflation could stay “uncomfortably high” around 5% over the first half of 2022, and then “coming down fairly quickly in the second half.”
However, “there is some uncertainty about how quickly inflation will come down because we’ve never experienced a pandemic like this before.”
“It’s clear that interest rates need to be on a rising path,” Macklem said. “The slope of that path is going to depend on economic developments, and if consumers spend more, the slope of that path, likely, has to be steeper.”
“It will be a series of increases, not a single increase,” he said.
