Quote:
Originally Posted by The Fonz
https://www.cbc.ca/news/business/pow...ttis-1.6685344
U.S. Federal Reserve foresees another year of rising interest rates for 2023
"Canadian borrowers hoping that the U.S. central bank would signal that rate hikes were over were once again disappointed after the Federal Reserve chair Jerome Powell not only hiked rates by a half a point to a 15-year high but promised more increases in the new year....
...In fact, of the 19 Federal Reserve officials on the monetary policy committee, 17 offered independent estimates that the Fed's target interest rates would have to rise above five per cent in 2023."
Suggests Federal Reserve officials foresee atleast another 75bps worth of increases coming, and BOC would likely follow pretty closely.
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Part of that is to keep inflation sinking rather than complete reality. If you indicate that interest rates may decrease soon - you risk turning the inflation faucet back on.
There's a good chunk of inflation that just occurs because of people's expectations - if they are expecting that interest rates are going to keep going up - inflation expectations lower.