BOC’s Poloz: Central banks face considerable uncertainty today

The Bank of Canada (BOC) Governor Stephen Poloz released a paper on “Technological Progress and Monetary Policy: Managing the Fourth Industrial Revolution” this Friday, with the key points noted below:

– “Central banks face considerable uncertainty today.

– Although we are understandably focused on the consequences of rising geopolitical risk and the potential consequences of a global trade war, we should not forget that other longer-term structural forces remain at play.

– The fourth industrial revolution is underway.

– There is a good possibility that we will experience something very similar over the next decade, as the fourth industrial revolution unfolds.

– The the situation may be complicated by a trade war and the associated deglobalization, which may offset some of the revolution’s positive effects.

– However, setting aside that complication, the prescription for monetary policy over the longer-term is likely to be very much like that of the Greenspan era.

– Canadian wage inflation now above 4% in most measures.”

The Canadian dollar sees some fresh buying vs. the US dollar over the last hour, mainly driven by higher oil prices amid fresh US-China trade optimism while markets digest the latest comments from the BOC Governor Poloz. At the press time, USD/CAD trade -0.10% lower near 1.3230 region, at two-day lows.