Comments from Bank of Canada Governor Steven Poloz:
- Will only use forward guidance during periods of market stress and periods when traditional tools are constrained
- Otherwise will let markets do their job, which is to deal with daily data flow and grind out new pricing
- Canada has ‘considerable excess capacity” in economy
- Risks around achieving inflation target over a reasonable timeframe are roughly balanced
- Canadian dollar had gone up more than models would have predicted because of weak USD
No visible reaction in the Canadian dollar after the comments.
