Macklem opening statement: 'We need higher rates and the economy can handle them'

• Reiterates that the BOC will act forcefully if need be
• Canadian should expect rates to continue to rise towards more neutral settings, current estimate is that is between 2-3%
• If demand responds quickly to higher rates and inflationary pressures moderate, it may be appropriaate to pause hikes once we get closer to the neutral rate
• On the other hand, we may need to take rates modestly above neutral for a period to bring demand and supply back into balance and 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 to target
• Impact of Russia-Ukraine war on Canada is likely to be small
• Businesses indicated they will need to raise wages to attract workers
• Exports are picking up
• We are concerned about the broadening of inflation in Canada
• Canadians should expect rates in a neutral setting, between 2-3%
• We have an inflation target, not an interest rate target

I believe the comment on 'forceful' is a hint another 50 bps hike in June. USD/CAD has slipped on the comments but it comes at the same time as an improvement in the broad risk trade and dip in the US dollar.