MNI: BOC Will Take Time To Cut Rates, Ex Adviser Ragan Says

The Bank of Canada will move slowly to cut interest rates to make sure it gets inflation fully under control, former adviser Chris Ragan said Tuesday, comments coming at a time when some investors are betting on a move as soon as March.

"I want to be skeptical about the case for imminent rate cuts," Ragan, a McGill University professor who has also advised the federal finance department, said on a Global Risk Institute webcast. The Bank's last hike in July was a sign officials see a long-lasting need for restrictive policy, he said. The economy is slowing but still has enough momentum to concern the Bank about price expectations and wage inflation, he said.

The scope for a big rate-cut cycle is also diminished with evidence the neutral rate is rising, Ragan said. (See: MNI INTERVIEW: No BOC Rate Cuts Until Later In 2024-Conf Board)