BOC's Rogers: A period of lower growth needed to balance things out

• Because we are in a period of excess demand, we need a period of lower growth to balance things out and bring demand back in line with supply.
• Reiterates that BOC judges policy rate will need to rise further
• Recent data show inflationary pressures in Canada are increasingly broad based
• Getting inflation all the way back to 2% will take some time, there could be bumps along the way
• Governing Council discussed risks that inflation could be entrenched
• There is a risk consumer spending has more momentum than we expect
• We’ll be keeping a close eye on how global developments and commodity prices affect our exports and business investment as well as how this translates into pricing decisions
• We’ll be watching to see if supply disruptions are improving
• We will not rest easy until we can get inflation Inflation Inflation is defined as a quantitative measure of the rate in which the average price level of goods and services in an economy or country increases over a period of time. It is the rise in the general level of prices where a given currency effectively buys less than it did in prior periods.In terms of assessing the strength or currencies, and by extension foreign exchange, inflation or measures of it are extremely influential. Inflation stems from the overall creation of money. This money is m Inflation is defined as a quantitative measure of the rate in which the average price level of goods and services in an economy or country increases over a period of time. It is the rise in the general level of prices where a given currency effectively buys less than it did in prior periods.In terms of assessing the strength or currencies, and by extension foreign exchange, inflation or measures of it are extremely influential. Inflation stems from the overall creation of money. This money is m Read this Term back to target

This is hawkish stuff and indicates that the BOC is likely to get to 4% with a good chance of getting above. What we were looking for from this speech was a hint about how much is coming at the next meeting or the terminal rate but we're left to use our imagination. Still, I expect we'll be seeing Canadian bank economists raising BOC forecasts in the day ahead.

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