The Financial Post reports in its Wednesday edition that "muted" core inflation supports the Bank of Canada's "wait-and-see stance" on interest rates, Andrew Grantham, executive director and senior economist at Canadian Imperial Bank of Commerce, said. The Post's Jane Switzer writes that Mr. Grantham said in a note, "While price pressures may accelerate further ahead, the weakness of core inflationary measures as oil prices were initially spiking is an indication of the slack that exists within the Canadian economy, which will continue to put downward pressure on inflation components that aren't greatly affected by oil prices." Mr. Grantham said core measures of inflation are "likely to accelerate again over the summer" as airfare price increases show up in the data and higher transportation costs lead to prices rising in other areas, including food. Mr. Grantham added, "However, the slack currently in the economy will limit the extent of that acceleration, and we continue to forecast that the Bank of Canada will hold its overnight rate at 2.25 per cent throughout the remainder of the year." The big question for the Bank of Canada is how much of the energy price shock will spill over into core inflation and when.