Bank of Canada and government agree to keep 2% inflation target
TLT•The Bank of Canada and the federal finance ministry agreed to keep the inflation target at 2% within a 1%-3% control range under a new five-year monetary policy framework taking effect January 1.
1. Target stays unchanged
The Bank of Canada and the federal finance ministry unveiled a new five-year monetary policy framework that keeps the inflation target at 2%, the midpoint of a 1%-3% control range that has been in place for 35 years. The framework takes effect January 1.
2. Employment flexibility retained
The bank said it would continue using the target range’s flexibility to seek maximum sustainable employment when conditions warranted. Monetary policy will continue to give equal emphasis to inflation deviations above and below the target. Governor Tiff Macklem will speak about the renewed framework on November 24.
