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MNI: BOC Says Canada Needs Higher Rates, CPI Well Above Target

(MNI) Ottawa
OTTAWA (MNI)

Governor Macklem says the economy can handle higher borrowing costs.

Bank of Canada Governor Tiff Macklem said Thursday he needs to raise interest rates to pull down inflation that's well above his 2% target, and strength in job and housing markets will help deliver a soft landing.

"The Bank's number one priority is to get inflation back to target, and we are raising interest rates to make that happen," Macklem said in opening remarks for a press conference. "The economy can handle-- indeed needs-- higher interest rates." His remarks didn't mention potential for `forceful' action that have triggered some bets on a 75bp hike at the next meeting on July 13, following two straight 50bp increases.

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Bank of Canada Governor Tiff Macklem said Thursday he needs to raise interest rates to pull down inflation that's well above his 2% target, and strength in job and housing markets will help deliver a soft landing.

"The Bank's number one priority is to get inflation back to target, and we are raising interest rates to make that happen," Macklem said in opening remarks for a press conference. "The economy can handle-- indeed needs-- higher interest rates." His remarks didn't mention potential for `forceful' action that have triggered some bets on a 75bp hike at the next meeting on July 13, following two straight 50bp increases.