Whether you are a homeowner facing the cost of renewing a mortgage or a business financial officer looking to renegotiate an essential loan, rising interest rates are causing a world of hurt for Canadian borrowers.
The latest data out Wednesday showed inflation had plunged to a two-year low of 3.4 per cent, a trifling few decimal points away from the Bank of Canada’s one-to-three per cent target range. So why doesn’t it just stop the pain?
“The bigger question is: Does the Bank of Canada believe that it can bring inflation back to two per cent without creating recession — and [it] has to ask itself what is the cost of further rate hikes?” Frances Donald, global chief economist at Manulife Investment Management, said in a CBC News interview shortly after the release of the consumer price index (CPI) data.
Central bank creates inflation
A lot of smart people in the financial sector seem to think a recession is coming. …