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Macklem Comments On FX and Fiscal

CANADA

(In some parts paraphrasing)

FX: Normally when we raise rates the exchange rate appreciates which does part of the work for us. This time that's not happening. Other things equals we have more to do with rates.


Fiscal: We are acutely aware that inflation is creating hardship for low-income Canadians. They have fewer buffers and the largest price increases have been in essential goods. Governments are quite sensibly looking at insulating the most vulnerable. The advice from the IMF is good: make sure those are targeted and temporary. As I’ve said several times already, this inflation is not hear to stay, it’s coming down.

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