Bank of Canada Cautious on 2024 Rate Cuts Despite Cooling Inflation Forecast
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Economists forecast interest rates to come down in 2024, but path to 2% inflation target may be bumpy. Bank of Canada cautious about committing to rate cuts.
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Housing market rebound if rates cut too soon poses risk of reigniting inflation. Geopolitical tensions like Middle East conflict also inflationary risk factors.
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Wage growth still hot at 4-5%. Productivity declining. Need moderation here for inflation to keep easing.
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Bank of Canada has room to cut rates faster if economy and job market unravel more quickly than expected.
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Bank of Canada Governor Macklem predicts transition year in 2024. Optimistic about return to growth and progress on inflation, but cautions bank will need to remain vigilant.