mackaycartoons

Graeme MacKay's Editorial Cartoon Archive

  • Archives
  • Kings & Queens
  • Prime Ministers
  • Sharing
  • Special Features
  • The Boutique
  • Who?
  • Young Doug Ford
  • Presidents

Thursday January 27, 2022

January 27, 2022 by Graeme MacKay
Share
Tweet
Pin
Share
Share
0 Shares

Editorial Cartoon by Graeme MacKay, The Hamilton Spectator – Thursday January 27, 2022

Despite record high inflation, Bank of Canada holds interest rate steady — for now

May 2, 2020

The Bank of Canada has decided not to raise its benchmark interest rate just yet.

Like many other central banks around the world, the bank slashed its core lending rate — known as the target for the overnight rate — at the onset of the pandemic in March 2020, to ensure that consumers and businesses had access to cheap lending in order to keep the economy afloat.

But two years of rock-bottom lending rates have been a major contributor to inflation, which rose to almost five per cent in Canada last month — its highest level in more than 30 years.

April 25, 2014

That prompted expectations that the bank would need to start raising its rate soon. But it decided not to do that yet, electing to keep its rate at 0.25 per cent, the same level it’s been for the last 670 days.

But the bank did make clear that it could be leaning that way in the very near future.

While the rate stayed the same, the bank did decide to do away with what it calls its “exceptional forward guidance” to keep rates where they are for as long as is needed, until the slack in the economy gets absorbed.

“This is a significant shift in monetary policy,” governor Tiff Macklem said at a news conference following the announcement. “[It] signals that interest rates will now be on a rising path.”

July 12, 2017

But the bank said the ongoing uncertainty around the Omicron variant during the coronavirus pandemic means it’s not ready to take its first steps along that path yet.

At least one bank watcher says standing pat was a mistake.

“The decision, in our view, is a policy misstep,” foreign exchange analyst Simon Harvey with Monex Canada said, “and is one that could prove costly later down the line.”

By waiting to raise its rate, Harvey said, the bank risks “emboldening near-term inflation expectations and flaming the fire underneath the housing market.”

Canada’s housing market has been on fire during the pandemic, with cheap lending acting like rocket fuel on the burning tinder of demand, sending prices higher. 

The central bank’s rate impacts the rates that Canadians get from their banks on things such as variable-rate mortgages, so keeping the rate low will extend that. (CBC) 

 

Posted in: Canada Tagged: 2022-04, architecture, bank, Bank of Canada, Canada, covid-19, Economy, interest rate, monster, Omicron, pandemic, Tiff Maclem
← Wednesday January 26, 2022
Friday January 28, 2022 →

Please note…

This website contains satirical commentaries of current events going back several decades. Some readers may not share this sense of humour nor the opinions expressed by the artist. To understand editorial cartoons it is important to understand their effectiveness as a counterweight to power. It is presumed readers approach satire with a broad minded foundation and healthy knowledge of objective facts of the subjects depicted.

Social Media Connections

Link to our Facebook Page
Link to our Flickr Page
Link to our Pinterest Page
Link to our Twitter Page
Link to our Website Page
  • HOME
  • Sharing
  • The Boutique
  • The Hamilton Spectator
  • Artizans Syndicate
  • Association of Canadian Cartoonists
  • Wes Tyrell
  • Martin Rowson
  • Guy Bado’s Blog
  • You Might be From Hamilton if…
  • MacKay’s Most Viral Cartoon
  • Intellectual Property Thief Donkeys
  • National Newswatch
  • Young Doug Ford

Your one-stop-MacKay-shop…

T-shirts, hoodies, clocks, duvet covers, mugs, stickers, notebooks, smart phone cases and scarfs

Brand New Designs!

Follow me on Twitter

My Tweets
Follow Graeme's board My Own Cartoon Favourites on Pinterest.

MacKay’s Virtual Gallery

Archives

Copyright © 2016 mackaycartoons.net

Powered by Wordpess and Alpha.

 

Loading Comments...