(Ottawa) The Governor of the Bank of Canada, Tiff Macklem, believes that the federal budget tabled last month will not have much effect on inflation.
Mr. Macklem was testifying before a Senate committee alongside Bank of Canada Senior Deputy Governor Carolyn Rogers following the bank’s latest interest rate announcement.
The governor says the spending plan hasn’t changed much of the federal government’s fiscal trajectory.
This is why Mr Macklem does not expect the budget to have a significant impact on economic growth or inflation.
Canada’s Finance Minister Chrystia Freeland’s budget offsets new spending with higher-than-expected taxes and government revenues, helping to soften the deficit.
The Bank of Canada has been encouraged by progress in reducing inflation and has indicated that it is moving ever closer to reducing interest rates.