"We've been pretty clear that interest rates need to continue to move up," Bank of Canada (BoC) Governor Tiff Macklem reiterated on Thursday, as reported by Reuters.

Key takeaways

"How high interest rates need to go and for how long is going to really depend on how inflation and the economy evolve."

"We are more concerned about the upside shocks to inflation than the downside."

"We certainly wouldn't want to see inflation go up further."

"When we assess impact of higher interest rates on demand, will factor in high household indebtedness levels."

"Interest rates might have a bit more traction because of high levels of household indebtedness."

"Below trend growth is low growth, it doesn't need to be a recession."

"Whether we can get to a soft landing or not will depend in part on how sticky inflation is in Canada."

"Path to a soft landing in Canada is a narrow path and there are risks."

Market reaction

USD/CAD preserves its bullish momentum after these comments and was last seen rising 0.92% on the day at 1.3740.