Economist shared views
Taking into account current trends, the Bank of Canada is likely to raise its benchmark interest rate during January. The 26th meeting, according to a JPMorgan economist, is well ahead of its previously announced rate-hike timeline.
New York’s Silvana DiMino said the central bank expects to raise its benchmark rate by 25 basis points to 0.5% in January, with five rate hikes this year to raise the benchmark rate to 1.5% by the end of 2022. Economist based at JP Morgan.
DiMino said, “Based on the Bank of Canada’s rhetoric in December, it was clear that labor market dynamics and outperforming economic data had raised concerns in the Bank that the output gap was closing faster than expected. “
Data from Statistics Canada showed that the national economy saw 54,700 new jobs in December, far higher than experts’ expectations of 25,000 for that month. Full-time employment increased by 123,000, while the unemployment rate fell to a historic low of 5.9%.
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The Financial Post’s Kevin Carmichael echoed these sentiments, saying that the strong recovery essentially pushed the labor market back to pre-pandemic levels, thus prompting the BoC to implement rate hikes as quickly as possible. inspired.
As Carmichael wrote recently, the central bank could push its rate-hike timetable, “perhaps even to the end of January when policymakers gather to update their assessments of the economy and restructure policy.” Huh.”