Kozicki

This sounds like a hint at a 50 basis point hike next month.

  • The pace and size of rate hikes and the start of QT will be active parts of our deliberations
  • Inflation in Canada is too high, labour markets are tight and there is considerable momentum
  • Households on average appear to be in better financial shape than at the start of 2017-18 tightening cycle
  • Household indebtedness is now above pre-pandemic levels
  • High indebtedness could amplify the impact of rising interest rates
  • Key concern is broadening of price pressures, around two-thirds of components of CPI are now showing inflation above 3%
  • Persistently elevated inflation increases the risk that longer-run inflation expectations could drift upward
  • Invasion of Ukraine is adding to inflationary pressures

The next BOC decision is on April 13.