MNI BRIEF: BOC To Hike Rate Forcefully If Needed To Meet Goal

Bank of Canada Governor Tiff Macklem said Monday that he will hike interest rates forcefully if needed to bring inflation back to the 2% target, and said price gains are surprisingly high, broad and persistent.

"We are committed to using our policy interest rate to return inflation to target and will do so forcefully if needed," Macklem said in an opening statement to lawmakers. On Thursday Macklem told reporters he wouldn't rule out an even bigger rate hike than the 50bps he delivered last month.

The economy is moving past full capacity and unemployment at a record low 5.3%, Macklem said, and has enough momentum to absorb higher borrowing costs. He reiterated inflation will average about 6% in the first half and not return to 2% until 2024.

While "we do not have a pre-set destination for the policy interest rate," it will likely move to a neutral range from 2%-3%, he said.