{"id":23490,"date":"2022-07-04T18:01:06","date_gmt":"2022-07-04T18:01:06","guid":{"rendered":"https:\/\/www.pantheregroup.com\/2022\/07\/04\/bank-of-canada-surveys-show-inflation-expectations-surging\/"},"modified":"2022-07-04T18:01:06","modified_gmt":"2022-07-04T18:01:06","slug":"bank-of-canada-surveys-show-inflation-expectations-surging","status":"publish","type":"post","link":"https:\/\/www.pantheregroup.com\/2022\/07\/04\/bank-of-canada-surveys-show-inflation-expectations-surging\/","title":{"rendered":"Bank of Canada surveys show inflation expectations surging"},"content":{"rendered":"<p> \n<\/p>\n<div id=\"\">\n<header aria-label=\"Beginning of Article\" class=\"article-header\">\n<nav aria-label=\"Breadcrumb\" class=\"breadcrumbs\">\n<h2 class=\"visually-hidden\">Breadcrumb Trail Links<\/h2>\n<ol class=\"breadcrumbs__items list-unstyled\">\n<li class=\"breadcrumbs__item\"> News <\/li>\n<li class=\"breadcrumbs__item\"> FP Economy <\/li>\n<\/ol>\n<\/nav>\n<p class=\"article-subtitle\"> Bank&#8217;s surveys of businesses and consumers show growing doubt about its ability to put a lid on inflation <\/p>\n<div class=\"article-meta\">\n<div class=\"published-date\">\n<p>Publishing date:<\/p>\n<p> <span class=\"published-date__since\">Jul 04, 2022<\/span> \u00a0\u2022\u00a0 <span class=\"updated-date__since\">30\u00a0minutes ago<\/span> \u00a0\u2022\u00a0 <span class=\"published-date__word-count\">3 minute read<\/span> \u00a0\u2022\u00a0 <span>  <span class=\"comment-bubble\"> <svg xmlns=\"http:\/\/www.w3.org\/2000\/svg\" height=\"16\" viewbox=\"0 0 24 24\" width=\"16\"><path d=\"M4,0 C2.93914,0 1.921718,0.421428 1.171572,1.171572 C0.421428,1.921718 0,2.93914 0,4 L0,24 L3.846,20.158 L4,20.16 L20,20.16 C21.0608,20.16 22.0782,19.73858 22.8284,18.98842 C23.5786,18.23828 24,17.22086 24,16.16 L24,4 C24,2.93914 23.5786,1.921718 22.8284,1.171572 C22.0782,0.421428 21.0608,0 20,0 L4,0 Z M2,4 C2,3.46956 2.21072,2.96086 2.58578,2.58578 C2.96086,2.21072 3.46956,2 4,2 L20,2 C20.5304,2 21.0392,2.21072 21.4142,2.58578 C21.7892,2.96086 22,3.46956 22,4 L22,16.16 C22,16.69044 21.7892,17.19914 21.4142,17.57422 C21.0392,17.94928 20.5304,18.16 20,18.16 L4,18.16 L3.048,18.126 L2,19.174 L2,4 Z\"\/><\/svg><\/span> 21 Comments  <\/span> <\/div><\/div>\n<figure class=\"featured-image\"><picture class=\"featured-image__ratio\"><source media=\"(min-width: 1200px)\" srcset=\"https:\/\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2022\/07\/inflation-bank-of-canada-0704.jpg?quality=90&amp;strip=all&amp;w=564&amp;h=423&amp;type=webp,&#10;            https:\/\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2022\/07\/inflation-bank-of-canada-0704.jpg?quality=90&amp;strip=all&amp;w=1128&amp;h=846&amp;type=webp 2x\" type=\"image\/webp\"\/><source media=\"(min-width: 1200px)\" srcset=\"https:\/\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2022\/07\/inflation-bank-of-canada-0704.jpg?quality=90&amp;strip=all&amp;w=564&amp;h=423&amp;type=jpg,&#10;                https:\/\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2022\/07\/inflation-bank-of-canada-0704.jpg?quality=90&amp;strip=all&amp;w=1128&amp;h=846&amp;type=jpg 2x\" type=\"image\/jpeg\"\/><source media=\"(min-width: 768px)\" srcset=\"https:\/\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2022\/07\/inflation-bank-of-canada-0704.jpg?quality=90&amp;strip=all&amp;w=472&amp;h=354&amp;type=webp,&#10;            https:\/\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2022\/07\/inflation-bank-of-canada-0704.jpg?quality=90&amp;strip=all&amp;w=944&amp;h=708&amp;type=webp 2x\" type=\"image\/webp\"\/><source media=\"(min-width: 768px)\" srcset=\"https:\/\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2022\/07\/inflation-bank-of-canada-0704.jpg?quality=90&amp;strip=all&amp;w=472&amp;h=354&amp;type=jpg,&#10;                https:\/\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2022\/07\/inflation-bank-of-canada-0704.jpg?quality=90&amp;strip=all&amp;w=944&amp;h=708&amp;type=jpg 2x\" type=\"image\/jpeg\"\/><source media=\"(max-width: 767px)\" srcset=\"https:\/\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2022\/07\/inflation-bank-of-canada-0704.jpg?quality=90&amp;strip=all&amp;w=288&amp;h=216&amp;type=webp,&#10;            https:\/\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2022\/07\/inflation-bank-of-canada-0704.jpg?quality=90&amp;strip=all&amp;w=576&amp;h=432&amp;type=webp 2x\" type=\"image\/webp\"\/><\/picture><figcaption class=\"featured-image__caption image-caption\"><span class=\"caption\">Short-term expectations of inflation climbed to the highest since the central bank began polling consumers in 2014. <\/span> <span class=\"credit\">Photo by Getty Images<\/span> <\/figcaption><\/figure>\n<\/header>\n<section class=\"article-content__content-group\">\n<h2 class=\"visually-hidden\">Article content<\/h2>\n<p data-async=\"\">The Bank of Canada\u2019s latest quarterly surveys of business and consumer expectations show growing doubt about the central bank\u2019s ability to put a lid on inflation, increasing the odds of a bigger-than-usual interest-rate increase later this month. Here\u2019s what you need to know:<\/p>\n<\/section>\n<div class=\"ad__section-border article-content__ad-group\">\n<section aria-describedby=\"advertisment5266533107274603024514272257788479\" class=\"ad\">\n<h2 class=\"visually-hidden\" id=\"advertisment5266533107274603024514272257788479\">Advertisement 2<\/h2>\n<div class=\"ad__container\">\n<div class=\"ad__inner\" id=\"ad__inner-2\">\n<div class=\"ad__inner__container\" data-ad=\"[[6,6],[1200,250],[1200,90],[970,90],[970,250],[728,90],[300,250]]\" data-ad-interscroller=\"6x6\" data-ad-loc=\"2\" data-ad-mobile=\"[[6,6],[320,50],[300,50],[300,250],[300,600]]\" id=\"ad-2\" style=\"--desktopHeight:250px;--mobileHeight:600px\">\n<div aria-hidden=\"true\" class=\"ad__placeholder\">\n<p> This advertisement has not loaded yet, but your article continues below. <\/p>\n<\/p><\/div><\/div><\/div><\/div>\n<\/section>\n<\/div>\n<section class=\"article-content__content-group\">\n<h2 class=\"visually-hidden\">Article content<\/h2>\n<h2>Businesses<\/h2>\n<p data-async=\"\">The Bank of Canada\u2019s first-quarter survey of businesses was conducted before Russia invaded Ukraine, so it wasn\u2019t a useful guide of what company leaders think about the world in which we live now.<\/p>\n<p data-async=\"\">Participants answered lots of questions, but the only ones that really matter right now are those related to inflation, which surged to 7.7 per cent in May, as measured by year-over-year increases in Statistics Canada\u2019s consumer price index. The results were concerning. Elevated numbers of companies continue to struggle with supply bottlenecks and labour shortages, suggesting the \u201cpresence of excess demand in the economy,\u201d which is inherently inflationary.<\/p>\n<p>Nearly half of companies said they expect wage increases will remain above pre-pandemic levels for the next 12 months, in part because workers are insisting on being compensated for a higher cost of living. Most businesses said they expect inflation will remain \u201csubstantially\u201d above two per cent for at least a couple of years, and a quarter of respondents said they saw inflation staying that high for longer.<\/p>\n<\/section>\n<div class=\"ad__section-border article-content__ad-group\">\n<section aria-describedby=\"advertisment293958414682426758138688882102537\" class=\"ad\">\n<h2 class=\"visually-hidden\" id=\"advertisment293958414682426758138688882102537\">Advertisement 3<\/h2>\n<div class=\"ad__container\">\n<div class=\"ad__inner\" id=\"ad__inner-3\">\n<div class=\"ad__inner__container\" data-ad=\"[[7,7],[1200,250],[1200,90],[970,90],[970,250],[728,90],[300,250]]\" data-ad-interscroller=\"7x7\" data-ad-loc=\"3\" data-ad-mobile=\"[[7,7],[300,250],[320,50],[300,50]]\" id=\"ad-3\" style=\"--desktopHeight:250px;--mobileHeight:250px\">\n<div aria-hidden=\"true\" class=\"ad__placeholder\">\n<p> This advertisement has not loaded yet, but your article continues below. <\/p>\n<\/p><\/div><\/div><\/div><\/div>\n<\/section>\n<\/div>\n<section class=\"article-content__content-group\">\n<h2 class=\"visually-hidden\">Article content<\/h2>\n<p>The survey has a relatively small sample size: the Bank of Canada\u2019s regional offices conduct 100 interviews per quarter from a rotating roster of businesses. However, policymakers trust the results, and the report ranks as one of the most important inputs into interest-rate decisions.<\/p>\n<figure class=\"embedded-image\"><picture class=\"embedded-image__ratio\"><source data-srcset=\"https:\/\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2022\/07\/BOS-inflation.png?quality=90&amp;strip=all&amp;w=564&amp;type=webp,&#10;            https:\/\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2022\/07\/BOS-inflation.png?quality=90&amp;strip=all&amp;w=1128&amp;type=webp 2x\" media=\"(min-width: 1200px)\" srcset=\"https:\/\/financialpost.com\/data:,https:\/\/financialpost.com\/1w\" type=\"image\/webp\"\/><source data-srcset=\"https:\/\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2022\/07\/BOS-inflation.png?quality=90&amp;strip=all&amp;w=564&amp;type=jpg,&#10;                https:\/\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2022\/07\/BOS-inflation.png?quality=90&amp;strip=all&amp;w=1128&amp;type=jpg 2x\" media=\"(min-width: 1200px)\" srcset=\"https:\/\/financialpost.com\/data:,https:\/\/financialpost.com\/1w\" type=\"image\/jpeg\"\/><source data-srcset=\"https:\/\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2022\/07\/BOS-inflation.png?quality=90&amp;strip=all&amp;w=472&amp;type=webp,&#10;            https:\/\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2022\/07\/BOS-inflation.png?quality=90&amp;strip=all&amp;w=944&amp;type=webp 2x\" media=\"(min-width: 768px)\" srcset=\"https:\/\/financialpost.com\/data:,https:\/\/financialpost.com\/1w\" type=\"image\/webp\"\/><source data-srcset=\"https:\/\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2022\/07\/BOS-inflation.png?quality=90&amp;strip=all&amp;w=472&amp;type=jpg,&#10;                https:\/\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2022\/07\/BOS-inflation.png?quality=90&amp;strip=all&amp;w=944&amp;type=jpg 2x\" media=\"(min-width: 768px)\" srcset=\"https:\/\/financialpost.com\/data:,https:\/\/financialpost.com\/1w\" type=\"image\/jpeg\"\/><source data-srcset=\"https:\/\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2022\/07\/BOS-inflation.png?quality=90&amp;strip=all&amp;w=288&amp;type=webp,&#10;            https:\/\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2022\/07\/BOS-inflation.png?quality=90&amp;strip=all&amp;w=576&amp;type=webp 2x\" media=\"(max-width: 767px)\" srcset=\"https:\/\/financialpost.com\/data:,https:\/\/financialpost.com\/1w\" type=\"image\/webp\"\/><img decoding=\"async\" alt=\"\" class=\"embedded-image__image lazyload\" src=\"https:\/\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2022\/07\/BOS-inflation.png?quality=90&amp;strip=all&amp;w=288\" srcset=\"https:\/\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2022\/07\/BOS-inflation.png?quality=90&amp;strip=all&amp;w=288,&#10;                https:\/\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2022\/07\/BOS-inflation.png?quality=90&amp;strip=all&amp;w=576 2x\" height=\"1080\" loading=\"lazy\" width=\"1000\"\/><\/picture><\/figure>\n<h2>Consumers<\/h2>\n<p>Short-term expectations of inflation climbed to the highest since the central bank began polling consumers in 2014. The median result of the survey of about 2,000 Canadians was for inflation of seven per cent a year from now, about five per cent in two years, and about four per cent in five years.<\/p>\n<p data-async=\"\">\u201cCanadians think the likelihood of inflation remaining high for a long time has increased,\u201d the report said.<\/p>\n<p>Households see supply-chain issues as the biggest source of inflation (about 40 per cent), followed by the pandemic and higher government spending, each the choice of about 25 per cent of respondents. Most still think the Bank of Canada will bring inflation down, but confidence is wavering: 35 per cent of respondents said they thought the central bank would achieve its inflation target \u201cmost of the time\u201d in the future, compared with 40 per cent at the end of 2019.<\/p>\n<\/section>\n<div class=\"ad__section-border article-content__ad-group\">\n<section aria-describedby=\"advertisment9261011802383239342732126764150889\" class=\"ad\">\n<h2 class=\"visually-hidden\" id=\"advertisment9261011802383239342732126764150889\">Advertisement 4<\/h2>\n<div class=\"ad__container\">\n<div class=\"ad__inner\" id=\"ad__inner-4\">\n<div class=\"ad__inner__container\" data-ad=\"[[1200,250],[1200,90],[970,90],[970,250],[728,90],[300,250]]\" data-ad-loc=\"4\" data-ad-mobile=\"[[320,50],[300,50],[300,250]]\" id=\"ad-4\" style=\"--desktopHeight:250px;--mobileHeight:250px\">\n<div aria-hidden=\"true\" class=\"ad__placeholder\">\n<p> This advertisement has not loaded yet, but your article continues below. <\/p>\n<\/p><\/div><\/div><\/div><\/div>\n<\/section>\n<\/div>\n<section class=\"article-content__content-group\">\n<h2 class=\"visually-hidden\">Article content<\/h2>\n<figure class=\"embedded-image\"><picture class=\"embedded-image__ratio\"><source data-srcset=\"https:\/\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2022\/07\/boc-consumer-expectationas.jpeg?quality=90&amp;strip=all&amp;w=564&amp;type=webp,&#10;            https:\/\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2022\/07\/boc-consumer-expectationas.jpeg?quality=90&amp;strip=all&amp;w=1128&amp;type=webp 2x\" media=\"(min-width: 1200px)\" srcset=\"https:\/\/financialpost.com\/data:,https:\/\/financialpost.com\/1w\" type=\"image\/webp\"\/><source data-srcset=\"https:\/\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2022\/07\/boc-consumer-expectationas.jpeg?quality=90&amp;strip=all&amp;w=564&amp;type=jpg,&#10;                https:\/\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2022\/07\/boc-consumer-expectationas.jpeg?quality=90&amp;strip=all&amp;w=1128&amp;type=jpg 2x\" media=\"(min-width: 1200px)\" srcset=\"https:\/\/financialpost.com\/data:,https:\/\/financialpost.com\/1w\" type=\"image\/jpeg\"\/><source data-srcset=\"https:\/\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2022\/07\/boc-consumer-expectationas.jpeg?quality=90&amp;strip=all&amp;w=472&amp;type=webp,&#10;            https:\/\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2022\/07\/boc-consumer-expectationas.jpeg?quality=90&amp;strip=all&amp;w=944&amp;type=webp 2x\" media=\"(min-width: 768px)\" srcset=\"https:\/\/financialpost.com\/data:,https:\/\/financialpost.com\/1w\" type=\"image\/webp\"\/><source data-srcset=\"https:\/\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2022\/07\/boc-consumer-expectationas.jpeg?quality=90&amp;strip=all&amp;w=472&amp;type=jpg,&#10;                https:\/\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2022\/07\/boc-consumer-expectationas.jpeg?quality=90&amp;strip=all&amp;w=944&amp;type=jpg 2x\" media=\"(min-width: 768px)\" srcset=\"https:\/\/financialpost.com\/data:,https:\/\/financialpost.com\/1w\" type=\"image\/jpeg\"\/><source data-srcset=\"https:\/\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2022\/07\/boc-consumer-expectationas.jpeg?quality=90&amp;strip=all&amp;w=288&amp;type=webp,&#10;            https:\/\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2022\/07\/boc-consumer-expectationas.jpeg?quality=90&amp;strip=all&amp;w=576&amp;type=webp 2x\" media=\"(max-width: 767px)\" srcset=\"https:\/\/financialpost.com\/data:,https:\/\/financialpost.com\/1w\" type=\"image\/webp\"\/><img decoding=\"async\" alt=\"\" class=\"embedded-image__image lazyload\" src=\"https:\/\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2022\/07\/boc-consumer-expectationas.jpeg?quality=90&amp;strip=all&amp;w=288\" srcset=\"https:\/\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2022\/07\/boc-consumer-expectationas.jpeg?quality=90&amp;strip=all&amp;w=288,&#10;                https:\/\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2022\/07\/boc-consumer-expectationas.jpeg?quality=90&amp;strip=all&amp;w=576 2x\" height=\"810\" loading=\"lazy\" width=\"1000\"\/><\/picture><\/figure>\n<h2>What does it mean for interest rates?<\/h2>\n<p>A big part of monetary policy is psychology. If executives and consumers are confident that central banks such as the Bank of Canada will make good on their inflation targets, they will set the prices they charge for their goods and services and their wage demands accordingly. And if expectations remain anchored to the target, then central bankers won\u2019t have to raise or lower interest rates aggressively to maintain price stability.<\/p>\n<section aria-labelledby=\"moreTopicLabel5722585495065056495180979795179162\" class=\"more-topic\" data-carousel-component=\"\" data-carousel-icon-button=\"\" data-carousel-type=\"list\"> <button aria-hidden=\"true\" class=\"more-topic__button-prev\" data-carousel-prev=\"\" tabindex=\"-1\" title=\"previous\" type=\"button\"\/> <\/p>\n<ol class=\"more-topic__items list-unstyled\" data-carousel-slide-list=\"\" tabindex=\"0\">\n<li class=\"more-topic__item\" data-carousel-item=\"\">  <picture class=\"more-topic__item-image\"><img decoding=\"async\" alt=\"A vendor in Toronto's St. Lawrence Market shows off his produce. The cost of Statistics Canada's food basket rose 9.7 per cent in May from a year earlier.\" class=\"lazyload\" src=\"https:\/\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2022\/06\/inflation-canada-0622.jpg?h=96&amp;strip=all&amp;quality=80\" height=\"96\" loading=\"lazy\" srcset=\"https:\/\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2022\/06\/inflation-canada-0622.jpg?h=96&amp;strip=all&amp;quality=80,&#10;                                    https:\/\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2022\/06\/inflation-canada-0622.jpg?h=192&amp;strip=all&amp;quality=80 2x,&#10;                                    https:\/\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2022\/06\/inflation-canada-0622.jpg?h=288&amp;strip=all&amp;quality=80 3x\" width=\"96\"\/><\/picture>\n<h3 class=\"more-topic__item-text\"> <span class=\"more-topic__item-text-clamp\"> Inflation surges to 7.7%, fastest since 1983: What Canadians need to know <\/span> <\/h3>\n<\/li>\n<li class=\"more-topic__item\" data-carousel-item=\"\">\n<h3 class=\"more-topic__item-text\"> <span class=\"more-topic__item-text-clamp\"> Bank of Canada\u2019s Paul Beaudry suggests benchmark rate could top 3% <\/span> <\/h3>\n<\/li>\n<li class=\"more-topic__item\" data-carousel-item=\"\">  <picture class=\"more-topic__item-image\"><img decoding=\"async\" alt=\"Bank of Canada Governor Tiff Macklem. \" class=\"lazyload\" src=\"https:\/\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2022\/06\/tiff-macklem-0531.jpg?h=96&amp;strip=all&amp;quality=80\" height=\"96\" loading=\"lazy\" srcset=\"https:\/\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2022\/06\/tiff-macklem-0531.jpg?h=96&amp;strip=all&amp;quality=80,&#10;                                    https:\/\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2022\/06\/tiff-macklem-0531.jpg?h=192&amp;strip=all&amp;quality=80 2x,&#10;                                    https:\/\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2022\/06\/tiff-macklem-0531.jpg?h=288&amp;strip=all&amp;quality=80 3x\" width=\"96\"\/><\/picture>\n<h3 class=\"more-topic__item-text\"> <span class=\"more-topic__item-text-clamp\"> Bank of Canada raises rate half a point to 1.5%, signals more hikes to come <\/span> <\/h3>\n<\/li>\n<\/ol>\n<p><button aria-hidden=\"true\" class=\"more-topic__button-next\" data-carousel-next=\"\" tabindex=\"-1\" title=\"next\" type=\"button\"\/> <\/section>\n<p>There\u2019s some evidence now that inflation expectations are becoming unanchored, which could prompt Bank of Canada Governor Tiff Macklem to attempt a bigger bang in order to show skeptical Canadians that he\u2019s serious about wrestling inflation back to the two-per-cent target, even if many of the forces putting upward pressure on prices are beyond his control.<\/p>\n<p>In the United States, the Federal Reserve, which is facing even hotter inflation, increased its benchmark interest rate three quarters of a percentage point, an outsized move that underlined the worry that central bankers are losing their grip on inflation expectations. Expect the Bank of Canada to do the same when it updates policy on July 13. 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