MNI BRIEF: BOC Gov Speech Highlights- Opens Door To Cut Debate

Highlights of Bank of Canada Governor Tiff Macklem's speech Friday in Toronto.

• "We expect growth and jobs to be picking up later next year, and inflation will be getting close to the 2% target. And once Governing Council is assured that we are clearly on a path back to price stability, we will be considering whether and when we can lower our policy interest rate."
• "It is tempting to rush ahead to that discussion. But it’s still too early to consider cutting our policy rate. Until we see evidence that we are clearly on a path back to 2% inflation, I expect Governing Council will continue to debate whether monetary policy is restrictive enough and how long it needs to remain restrictive to restore price stability. In a world with increased macroeconomic volatility, we are also conscious that we may need to be nimble."
• "Looking ahead, I expect 2024 to be a year of transition."
• "Over the coming months, you should expect to see some push and pull on inflation as the cooling economy reduces price pressures while other forces continue to exert upward pressure. That’s why further declines in inflation will likely be gradual. When it’s clear that inflation is on a sustained downward track, we can begin discussing lowering our policy interest rate. We don’t need to wait until inflation is all the way back to the 2% target to consider easing policy, but it does need to be clearly headed to 2%."
• "The 2% inflation target is now in sight. And while we’re not there yet, the conditions increasingly appear to be in place to get us there."
• "We still need to see more downward momentum in core inflation."
• "We are doing our best to balance the risks of over- and under-tightening. But if we learned anything from the bitter experience with inflation in the 1970s, the biggest mistake would be to waver in our resolve to control inflation and lose the public’s trust."
• Separate market notice says starting next month interest-rate announcements will move to 9:45am EST from 10am. The Governor and Senior Deputy will hold a press conference at 10:30am after each decision instead of the current practice of ones held at the four decisions a year with a new economic forecast. The Governor's opening statement will be released at 9:45am.