The Bank of Canada seems pretty intent on ignoring, as much as possible, the raging Canadian dollar. In most instances, that would be a bad idea. In the current circumstances, it may be good policy.
In the statement accompanying the bank’s stay-the-course interest-rate decision on Wednesday, the bank addressed the usual suspects influencing its economic outlook and the path of monetary policy. It talked about the COVID-19 pandemic and vaccinations, about rising inflation, about the state of employment and the prospects for a consumer-led recovery.
Oh, and it mentioned the dollar, which last week topped 83 cents (U.S.) for the first time in more than six years, and has skyrocketed more than 20 per cent in a little over a year.
“Commodity prices have risen further, notably oil, and the Canadian dollar has seen further appreciation.”