The Financial Post reports in its Friday, Sept. 10, edition that Bank of Canada Governor Tiff Macklem has begun extricating the central bank from the bond market.
The Post's Kevin Carmichael writes that Mr. Macklem used a speech on Thursday, hosted by Federation des chambres de commerce du Quebec, to chart an end to the BOC's first use of quantitative easing.
The BOC has so far acquired more than $330-billion of Government of Canada debt since the end of March, 2020.
Mr. Macklem said: "As the recovery progresses, we are moving closer to a time when continuing to add stimulus through QE will no longer be necessary. We are not there yet. That timing is a monetary policy decision that will depend on economic developments."
The recession that the pandemic triggered is over, but the recovery remains well short of Mr. Macklem's goals. For example, the labour underutilization rate was 14.4 per cent in July, down from 34.8 per cent in May, 2020, but still higher than 11.4 per cent in February. 2020. Mr. Macklem said, "It is reasonable to expect that when we do eventually need to reduce monetary stimulus, our first move will be to raise the target for the overnight rate -- our policy interest rate."
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