Achi news desk-
After Statistics Canada’s latest consumer price index revealed a 2.9 percent increase in the annual inflation rate in March, boosted in large part by higher gasoline prices, one leading economist says the path toward an interest rate cut in June appears clear.
Excluding gasoline prices, Statistics Canada reported the overall annual inflation rate for March was 2.8 per cent, down from 2.9 per cent in February.
“It’s great news, frankly,” said Pedro Antunes, chief economist of the Conference Board of Canada, during an interview with BNN Bloomberg on Tuesday.
“I think this will be another sign and insurance that (the Bank of Canada) is going to start taking that burden off households by lowering interest rates in June,” he said, adding that the central bank had been ” very careful around his messages.”
“There may have been some mistakes made during the pandemic about where interest rates are going to go, and I think they’ve been very careful now that things are going down,” said Antunes.
Despite predicting a rate cut this summer, Antunes also warned that the pace of the reduction will be “slow.”
“Let’s not forget on the way down I think interest rate cuts are going to be much slower and certainly take longer than when they came up,” he said.
Antunes also mentioned that the United States is in a more uncertain position regarding the possibility of rate cuts.
“In the United States, they don’t get as much certainty about rates coming down,” he said. “This is why that difference in interest rates is causing the dollar to drop a bit. But it is also important to note that if US rates remain high, that is going to have an impact on market rates even here in Canada as well. “
To watch Antunes’ full interview with BNN Bloomberg, click on the video above.
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The post ‘Great news’: Chief economist reacts to latest inflation data – BNN Bloomberg appeared first on Canada News Media.
