BOC Suggests Markets Too Focused on Its Core Inflation Gauges

BOC Suggests Markets Too Focused on Its Core Inflation Gauges

The Bank of Canada continued to fade its preferred measures of underlying price pressures, saying it’s weighing a broader suite of gauges that suggest core inflation is closer to its 2% target.

Bank of Canada Rethinks Inflation Measures

The Bank of Canada has cautioned that traders may be placing excessive importance on its ‘preferred’ core inflation measures. The bank indicated it is considering a wider range of indicators that suggest underlying price pressures are closer to the 2 per cent target. Deputy Governor Rhys Mendes outlined how the central bank assesses core consumer price inflation, which excludes volatile components such as gas and food. Mendes stated that the ban…