Economics
Bank of Canada to Let Inflation Run Hot, Teachers’ Mulraine Says
- Fund’s chief economist sees risk that prices may overshoot
- That could require more aggressive rate hikes in coming years
The Bank of Canada building in Ottawa.
Photographer: David Kawai/BloombergThis article is for subscribers only.
The chief economist for one of the world’s largest pension funds says the Bank of Canada is likely to let inflation run hotter for longer and keep interest rates low into 2023 to bolster growth.
Millan Mulraine of the Ontario Teachers’ Pension Plan said the central bank will wait almost two more years to raise borrowing costs to ensure a full economic recovery from the pandemic has taken hold. The benchmark overnight lending rate has been 0.25% since late March of 2020.