- BoC's governor Macklem: Bold policy response to the pandemic will make economy and financial system more vulnerable to economic shocks - Reuters
Market news
8 October 2020
BoC's governor Macklem: Bold policy response to the pandemic will make economy and financial system more vulnerable to economic shocks - Reuters
- Canada came into the pandemic with a number of vulnerabilities and it “seems certain” the country would exit with higher levels of government debt
- As much as bold policy response was needed, it will inevitably make economy and financial system more vulnerable to economic shocks down the road
- Without fiscal and monetary policy actions, economic devastation of the pandemic could have been much, much worse
- Full recovery will take long time; many risks remain
- Nobody wants to return to lockdown, but second wave could test our resolve to practice physical distancing and keep the pandemic from spreading uncontrollably again
- BoC is keeping a close eye on household debt levels and Canada’s housing market, both of which were vulnerabilities coming into the pandemic
- BoC will continue to assess the risk that credit losses could become large enough that banks need to tighten credit conditions; if this happens, our banking system would go from being a tailwind that supports recovery to being a headwind
- BoC is not discussing negative interest rates, but "never say never"
Market Focus
Material posted here is solely for information purposes and reliance on this may lead to losses. Past performances are not a reliable indicator of future results. Please read our full disclaimerOpen Demo Account & Personal Page