Federal Inflation Relief Package Likely to Drive Inflation: Scotiabank Economist
The federal package aimed at helping low-income earners weather inflation announced on Sept. 13 is likely to result in driving inflation up, says a Scotiabank economist.
“We will be assessing the implications for price pressures into H1 [first half of the year] but it seems sensible to assume that this will add to pressures on measures of core inflation relative to what would have otherwise occurred and hence aggravate the Bank of Canada’s stance on monetary policy,” wrote Derek Holt, vice president and head of capital markets economics at Scotiabank, on Sept. 13.
“Any belief that it will ease inflationary pressures must have studied different economics textbooks.”…