Tuesday, July 12, 2005

And the verdict is...

...no rate change from the Bank of Canada:
Central bankers suggested the growing economy is finally coping with upsets like the strong currency and is fast approaching its optimum speed -- anything faster could fuel inflation.

"In Canada, further progress has been made in adjusting to global developments and the economy is operating close to its production capacity,'' central bankers said in their statement.

"Some reduction in the amount of monetary stimulus will be required in the near term to keep aggregate demand and supply in balance and inflation on target.''

Let's just highlight what this means for the CCCE's benefit. The economy is doing well, with the largest risk being an excess of stimulus toward growth. That makes this an utterly stupid time to demand added stimulus in the form of tax cuts - even if they were provided, they'd have more potential to do harm than to do good.

Will Tommy Boy listen? Colour me skeptical.

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