Quote:
Originally Posted by Cowboy89
No the comment blasting Freeland was completely warranted. Devaluing the Canadian dollar by being the first to cut rates twice to bail out overextended borrowers who are overextended in part due to the governing party's policies is the opposite of victory lap worthy. As a Finance professional I feel like I'm in the twilight zone seeing that tweet by Canada's finance minister being presented as if it's indicative of anything positive (Other than I guess mild relief on interest costs for the overextended).
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Why would shifting from restrictive rates to a neutral rate be considered a bad thing? That's what a central bank with an inflation mandate does after bring inflation into the target range.
If lowering rates is bad, does that mean raising them was a good indicator? No, it meant inflation was high. Yes, it can sometimes be a precursor to a recession, but certainly not always. Of the last 5 times the Bank of Canada reduced interest rates by 1% or more (excluding COVID, since that wasn't a financial thing), there was only one recession.