Bank of Canada’s Macklem. We need to be more symmetric in our policy

• There is enough excess supply in the economy to bring inflation back down toward 2% target
• We need to be more symmetric in our policy
• Canada does not need more excess supply, it needs growth and job creation to start picking up
• indicators are suggesting that broad base price pressures are easing
• If inflation continues to move down as we expect, it is reasonable to expect lower rates.
• We don’t want to predetermine policy
• There was a clear consensus to cut by 25 basis points
• There was a clear consensus that the expected path of rates is lower but we are not on a predetermined path
• Broad agreement that inflation is going to come down, but progress can be uneven. We need to watch the opposing forces.
• Our assessment is that monetary policy is still restrictive. That is why we have cut our policy right at the last two meetings.
• We are determined to get inflation to 2% but we don’t want the economy to weaken too much to push inflation below 2%.
• We have a long-standing housing imbalance pushed by a structural imbalance from increase in population
• Households are cutting back on discretionary spending
• Canadians are feeling the pinch from higher grocery prices. Rates coming down should help the consumer.
• Getting a job is harder for new immigrants, for young workers.
• The divergence is widening vs the US. There is limits on how diverged policy can go.
• With inflation moving lower in the US, my feeling is the divergence vs the US will not be particularly serious
• Inflation disproportionately affects.lower income Canadians

This article was written by Greg Michalowski at www.forexlive.com.