Low productivity could weaken progress in bringing down inflation.
Bank of Canada Governor Tiff Macklem says Canada needs to focus on productivity now that inflation has been brought somewhat under control:
“He said now that inflation is under control, the central bank is in a better place to deal with any shocks.
Macklem spoke to reporters from Washington, where he was attending International Monetary Fund meetings.
He spoke about the need to increase productivity, or how much work gets done in a given time frame.
He said productivity has been a longstanding problem in Canada, which is a risk to GDP and can add to inflationary pressures.
Macklem also said the Bank of Canada is digesting the federal government’s announcement Thursday that it is slashing immigration targets for the next few years.”
To boost productivity, Canada will need a much more competitive business environment. That will require lowering taxes, reversing recent capital gains tax hikes, reducing interprovincial trade barriers, and deepening our trade ties with allied nations.
Spencer Fernando
Photo – YouTube
