The Bank of Canada Governor Senior Deputy Governor Carolyn Rogers says the labor market is a strong indicator right now of excess demand in the Canadian economy.
His key comments were the following:
- We don’t target components of inflation; we target the overall level of inflation.
- We need higher rates to moderate demand including demand in the housing market.
- Housing price growth is unsustainably strong in Canada, it would not be a bad thing for the economy for the growth in housing prices to moderate a bit.
- We do expect that housing price growth will moderate as rates go up.
- We think the technology that underlines digital currencies has some potential.
It’s completely realistic that Canadians are going to want a digital Canadian dollar at some point.
Meanwhile, USD/CAD has been consolidating in bullish territory but is down by some 0.28% at the time of writing, moving sideways within a 1.2825/93 range on Tuesday.
Looking forward for today the US will release its ADP Non-Farm Employment Change, US and Canada’s Trade Balance and at night the US FOMC which as always will create volatility in the pair.
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