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MNI: Canada Should End Stimulus Symmetrically- Ex Cabinet Czar

(MNI) Ottawa
OTTAWA (MNI)

While BOC is sending the right signal, fiscal policy is adding to inflation pressure, Kevin Lynch says.

Canada's fiscal and monetary policy should be tightened as fast as rate cuts and extra deficit spending were introduced when Covid hit to give the public a clear message inflation will remain under control, a former top federal cabinet adviser told MNI.

The Bank of Canada and Prime Minister Justin Trudeau's government have been too slow pulling back stimulus after several quarters of evidence the economy was returning to normal and pushing full employment, said Kevin Lynch, whose public service career included leading the branch of government that organized cabinet meetings, deputy minister of finance and industry departments and Canada's top official at the IMF.

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Canada's fiscal and monetary policy should be tightened as fast as rate cuts and extra deficit spending were introduced when Covid hit to give the public a clear message inflation will remain under control, a former top federal cabinet adviser told MNI.

The Bank of Canada and Prime Minister Justin Trudeau's government have been too slow pulling back stimulus after several quarters of evidence the economy was returning to normal and pushing full employment, said Kevin Lynch, whose public service career included leading the branch of government that organized cabinet meetings, deputy minister of finance and industry departments and Canada's top official at the IMF.

Keep reading...Show less