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Bank of Canada’s (BoC) policy framework provides the flexibility in the time it takes to get inflation back to target, BoC Governor Stephen Poloz said in a speech on Monday.

Additional takeaways 

“Choosing a policy course can entail degree of flexibility, allowing inflation to return to target more slowly or quickly than on average.”

“The bank’s current inflation target sits within a control range of 1% to 3%.”

“It does not make sense to think a single optimal path for our policy interest rate will be consistent with achieving inflation target.”

“For every base-case economic projection, a wide range of possible interest rate paths could ultimately be broadly consistent with the inflation target.”

“We want to emphasize that bank’s inflation target remains the overarching goal and is the prime mission of our monetary policy.”

Market reaction

The USD/CAD pair largely ignored these comments and was last seen trading at 1.3985, down 0.07% on a daily basis.