{"id":46760,"date":"2024-05-07T15:15:55","date_gmt":"2024-05-07T15:15:55","guid":{"rendered":"https:\/\/www.pantheregroup.com\/2024\/05\/07\/bank-of-canada-should-cut-rates-with-or-without-the-fed\/"},"modified":"2024-05-07T15:15:55","modified_gmt":"2024-05-07T15:15:55","slug":"bank-of-canada-should-cut-rates-with-or-without-the-fed","status":"publish","type":"post","link":"https:\/\/www.pantheregroup.com\/2024\/05\/07\/bank-of-canada-should-cut-rates-with-or-without-the-fed\/","title":{"rendered":"Bank of Canada should cut rates with or without the Fed"},"content":{"rendered":"<div style=\"text-align:center\"><\/div><p> \n<\/p>\n<div id=\"\">\n<header aria-label=\"Beginning of Article\" class=\"article-header article-header--story\">\n<nav aria-label=\"Breadcrumb\" class=\"breadcrumbs\" data-aqa=\"nav-breadcrumb\">\n<p>Breadcrumb Trail Links<\/p>\n<ol class=\"breadcrumbs__items list-unstyled\">\n<li class=\"breadcrumbs__item\">Economy<\/li>\n<\/ol>\n<\/nav>\n<div class=\"article-header__detail\">\n<div class=\"article-header__detail__texts\">\n<p class=\"article-subtitle\">Canada can cope with a weaker dollar; in fact the country needs it<\/p>\n<div class=\"article-meta\">\n<p><span class=\"published-date__since\">Published May 07, 2024<\/span> \u00a0\u2022\u00a0 <span class=\"updated-date__since\">Last updated 1\u00a0hour ago<\/span> \u00a0\u2022\u00a0 <span class=\"published-date__word-count\">4 minute read<\/span><\/p>\n<div class=\"article-meta__bottom\">\n<div class=\"bookmark-wrapper\">\n<div class=\"popover\" data-aqa=\"popover\" data-click-to-appear=\"True\" data-container=\"\" data-container-offset=\"\" data-no-style=\"\" data-popover-component=\"\" data-position=\"top\" data-sticky=\"\" data-tail-offset=\"200\" data-tail-position=\"right\"><button class=\"popover__trigger bookmark-button\"><span class=\"save-article-button save-article-button--default\" title=\"Save article\" data-article-id=\"63c6435e-e5c3-427f-8d10-dee74d72e756\" data-evt-skip-click=\"true\"\/><\/button><\/p>\n<div aria-describedby=\"popover-desc-popover-bookmark\" class=\"popover__content\" hidden=\"\" role=\"dialog\">\n<div class=\"popover__content__wrapper\">\n<div class=\"popover__content__text\" id=\"popover-desc-popover-bookmark\">\n<div class=\"bookmark__popover__content\">\n<p>You can save this article by registering for free here. Or sign-in if you have an account.<\/p>\n<\/div>\n<\/div>\n<p><button class=\"popover__content__close\" data-evt-skip-click=\"true\" title=\"Close\"><svg xmlns=\"http:\/\/www.w3.org\/2000\/svg\" xmlns:xlink=\"http:\/\/www.w3.org\/1999\/xlink\" viewbox=\"0 0 12 12\" class=\"icon--close\" height=\"12\" version=\"1.1\" width=\"12\"><polygon points=\"12 0.95 11.05 0 6 5.05 0.95 0 0 0.95 5.05 6 0 11.05 0.95 12 6 6.95 11.05 12 12 11.05 6.95 6\"\/><\/svg><\/button><\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<figure class=\"featured-image\" data-aqa=\"featured-image\"><picture class=\"featured-image__ratio\"><\/source><\/source><\/source><\/source><\/picture><figcaption class=\"featured-image__caption image-caption\"><span class=\"caption\">Bank of Canada governor Tiff Macklem, left, should not wait for Federal Reserve chair Jerome Powell to cut rates, says David Rosenberg. <\/span> <span class=\"credit\">Photo by Getty Images<\/span><\/figcaption><\/figure>\n<\/div>\n<\/header>\n<section class=\"article-content__content-group article-content__content-group--story\">\n<h2 class=\"visually-hidden\">Article content<\/h2>\n<p data-async=\"\">We find it rather incredible that the Bank of Canada is so nonchalant when it comes to the state of the Canadian economy. The degree of excess capacity is expanding by the month, inflation has swung to disinflation and the economy (in real output per-capita terms) is contracting at a two per cent annual rate. Yet the folks in Ottawa fiddle as the macro landscape burns.<\/p>\n<\/section>\n<div class=\"ad__section-border article-content__ad-group ad_counter_2\">\n<section aria-describedby=\"advertisment1937156267427052611363740143583232\" class=\"ad\">\n<p>Advertisement 2<\/p>\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]]\" data-aqa=\"advertisement\" 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<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/section>\n<\/div>\n<div class=\"article-block article-block-bg article-content__sign-in-group hidden\" data-aqa=\"identity-sign-in\" data-async=\"\" id=\"article-block\">\n<section class=\"row\">\n<header class=\"identity-intro col-xs-12 col-md-6 flex-justify-center\">\n<div class=\"col-xs-12 col-sm-10 col-md-10\"><img decoding=\"async\" src=\"data:image\/gif;base64,R0lGODlhAQABAIAAAAAAAP\/\/\/ywAAAAAAQABAAACAUwAOw==\" fifu-lazy=\"1\" fifu-data-sizes=\"auto\" fifu-data-srcset=\"https:\/\/dcs-static.gprod.postmedia.digital\/16.0.3\/websites\/images\/identity\/logo-identity-fp.svg 75w, https:\/\/dcs-static.gprod.postmedia.digital\/16.0.3\/websites\/images\/identity\/logo-identity-fp.svg 100w, https:\/\/dcs-static.gprod.postmedia.digital\/16.0.3\/websites\/images\/identity\/logo-identity-fp.svg 150w, https:\/\/dcs-static.gprod.postmedia.digital\/16.0.3\/websites\/images\/identity\/logo-identity-fp.svg 240w, https:\/\/dcs-static.gprod.postmedia.digital\/16.0.3\/websites\/images\/identity\/logo-identity-fp.svg 320w, https:\/\/dcs-static.gprod.postmedia.digital\/16.0.3\/websites\/images\/identity\/logo-identity-fp.svg 500w, https:\/\/dcs-static.gprod.postmedia.digital\/16.0.3\/websites\/images\/identity\/logo-identity-fp.svg 640w, https:\/\/dcs-static.gprod.postmedia.digital\/16.0.3\/websites\/images\/identity\/logo-identity-fp.svg 800w, https:\/\/dcs-static.gprod.postmedia.digital\/16.0.3\/websites\/images\/identity\/logo-identity-fp.svg 1024w, https:\/\/dcs-static.gprod.postmedia.digital\/16.0.3\/websites\/images\/identity\/logo-identity-fp.svg 1280w, https:\/\/dcs-static.gprod.postmedia.digital\/16.0.3\/websites\/images\/identity\/logo-identity-fp.svg 1600w\" alt=\"Financial Post\" class=\"market-logo\" height=\"37\" loading=\"lazy\" fifu-data-src=\"https:\/\/dcs-static.gprod.postmedia.digital\/16.0.3\/websites\/images\/identity\/logo-identity-fp.svg\" width=\"280\"\/><\/p>\n<div class=\"intro-body__premium hidden\">\n<p>THIS CONTENT IS RESERVED FOR SUBSCRIBERS ONLY<\/p>\n<p class=\"identity-intro__description\">Subscribe now to read the latest news in your city and across Canada.<\/p>\n<ul class=\"list-unstyled list-checkmark\">\n<li>Exclusive articles from Barbara Shecter, Joe O&#8217;Connor, Gabriel Friedman, Victoria Wells and others.<\/li>\n<li>Daily content from Financial Times, the world&#8217;s leading global business publication.<\/li>\n<li>Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.<\/li>\n<li>National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.<\/li>\n<li>Daily puzzles, including the New York Times Crossword.<\/li>\n<\/ul>\n<\/div>\n<div class=\"intro-body__register hidden\">\n<p>SUBSCRIBE TO UNLOCK MORE ARTICLES<\/p>\n<p class=\"identity-intro__description\">Subscribe now to read the latest news in your city and across Canada.<\/p>\n<ul class=\"list-unstyled list-checkmark\">\n<li>Exclusive articles from Barbara Shecter, Joe O&#8217;Connor, Gabriel Friedman, Victoria Wells and others.<\/li>\n<li>Daily content from Financial Times, the world&#8217;s leading global business publication.<\/li>\n<li>Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.<\/li>\n<li>National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.<\/li>\n<li>Daily puzzles, including the New York Times Crossword.<\/li>\n<\/ul>\n<\/div>\n<div class=\"intro-body__anonymous\">\n<p>REGISTER \/ SIGN IN TO UNLOCK MORE ARTICLES<\/p>\n<p class=\"identity-intro__description\">Create an account or sign in to continue with your reading experience.<\/p>\n<ul class=\"list-unstyled list-checkmark\">\n<li>Access articles from across Canada with one account.<\/li>\n<li>Share your thoughts and join the conversation in the comments.<\/li>\n<li>Enjoy additional articles per month.<\/li>\n<li>Get email updates from your favourite authors.<\/li>\n<\/ul>\n<\/div>\n<\/div>\n<\/header>\n<div class=\"identity-screen m-x-0 p-x-0 col-xs-12 col-md-6 flex-justify-center flex-align-center\" aria-live=\"assertive\">\n<section class=\"sail\" data-account-id=\"b9d3df2fccd108b5eff3c44f573b2cd6\" data-sailthru-personalization-engine=\"\" data-sailthru-personalization-engine-component=\"\"\/>\n<div class=\"m-x-0 p-x-0 col-xs-12 col-sm-6 col-md-12 flex-align-justify-center\" data-auth-component=\"\" id=\"auth-screen-form\">\n<div class=\"identity-screen-form--active w-full flex-align-justify-center\">\n<div class=\"identity-screen-form identity-screen__content w-full\">\n<h2 class=\"blocker-title\">Sign In or Create an Account<\/h2>\n<p><span class=\"identity-divider__line\"\/><span class=\"identity-divider__text\">or<\/span><span class=\"identity-divider__line\"\/><\/p>\n<\/div>\n<\/div>\n<\/div>\n<footer class=\"identity-footer identity-screen__content m-x-0 p-x-0 col-sm-6 col-md-12\"\/><\/div>\n<\/section>\n<\/div>\n<section class=\"article-content__content-group article-content__content-group--story\">\n<p>Article content<\/p>\n<p data-async=\"\">Business insolvencies have soared 87 per cent over the past year to the highest level since the peak of anxiety in 2008 when the global financial crisis was raging. The number of people entering the labour market without landing a job has practically doubled those who found one over the past year. That has resulted in more than a 20 per cent year-over-year surge in the ranks of the unemployed and it seems amazing to think that Bank of Canada officials are unaware of that statistic.<\/p>\n<\/section>\n<section class=\"article-content__content-group article-content__content-group--story\">\n<p>Article content<\/p>\n<p data-async=\"\">Any concerns over a resurrection of the housing bubble should be put to rest by now, with home sales in the once-hot Greater Toronto Area chilling 3.4 per cent month over month in April, losing ground in each of the past three months and down five per cent from year-ago levels. At the same time, new listings have ballooned 47 per cent year over year, and this new demand-supply backdrop has created the conditions for a flattening out in residential real estate prices.<\/p>\n<p data-async=\"\">Now that shelter costs are beginning to stabilize in real time, it won\u2019t be long before its inflationary effects fade from the consumer price index data because the headline inflation rate in Canada, absent the housing component, is running at a grand total of 1.5 per cent, melting before our very eyes from 3.9 per cent a year ago and 6.6 per cent two years ago.<\/p>\n<\/section>\n<div class=\"js-widget-content article-content__widget-group article-content__widget-group--content-slot11 article-content__widget-group--newsletter-slot\">\n<section class=\"newsletter-widget__new-story-page fp-headlinenews background--primary-light-gradient\" aria-labelledby=\"FinancialPostTopStories3811716688862063215251760193994752\" data-account-id=\"b9d3df2fccd108b5eff3c44f573b2cd6\" data-aqa=\"widget-newsletter\" data-newsletter=\"single\" data-newsletter-component=\"\" data-target-list=\"FP_HeadlineNews\" data-widget=\"newsletter\">\n<div class=\"newsletter-new-story-page-template\">\n<div class=\"newsletter-widget__header__new-story-page\">\n<div class=\"newsletter-widget__banner__new-story-page\"><img decoding=\"async\" src=\"data:image\/gif;base64,R0lGODlhAQABAIAAAAAAAP\/\/\/ywAAAAAAQABAAACAUwAOw==\" fifu-lazy=\"1\" fifu-data-sizes=\"auto\" fifu-data-srcset=\"https:\/\/dcs-static.gprod.postmedia.digital\/16.0.3\/websites\/images\/newsletters\/icon-fp-topStories.svg 75w, https:\/\/dcs-static.gprod.postmedia.digital\/16.0.3\/websites\/images\/newsletters\/icon-fp-topStories.svg 100w, https:\/\/dcs-static.gprod.postmedia.digital\/16.0.3\/websites\/images\/newsletters\/icon-fp-topStories.svg 150w, https:\/\/dcs-static.gprod.postmedia.digital\/16.0.3\/websites\/images\/newsletters\/icon-fp-topStories.svg 240w, https:\/\/dcs-static.gprod.postmedia.digital\/16.0.3\/websites\/images\/newsletters\/icon-fp-topStories.svg 320w, https:\/\/dcs-static.gprod.postmedia.digital\/16.0.3\/websites\/images\/newsletters\/icon-fp-topStories.svg 500w, https:\/\/dcs-static.gprod.postmedia.digital\/16.0.3\/websites\/images\/newsletters\/icon-fp-topStories.svg 640w, https:\/\/dcs-static.gprod.postmedia.digital\/16.0.3\/websites\/images\/newsletters\/icon-fp-topStories.svg 800w, https:\/\/dcs-static.gprod.postmedia.digital\/16.0.3\/websites\/images\/newsletters\/icon-fp-topStories.svg 1024w, https:\/\/dcs-static.gprod.postmedia.digital\/16.0.3\/websites\/images\/newsletters\/icon-fp-topStories.svg 1280w, https:\/\/dcs-static.gprod.postmedia.digital\/16.0.3\/websites\/images\/newsletters\/icon-fp-topStories.svg 1600w\" alt=\"Top Stories\" loading=\"lazy\" fifu-data-src=\"https:\/\/dcs-static.gprod.postmedia.digital\/16.0.3\/websites\/images\/newsletters\/icon-fp-topStories.svg\"\/><\/div>\n<div>\n<p>Top Stories<\/p>\n<p class=\"newsletter-widget__text__new-story-page\">Get the latest headlines, breaking news and columns.<\/p>\n<\/div>\n<\/div>\n<div class=\"newsletter-widget__body__new-story-page\">\n<div class=\"js-replace-main__new-story-page\">\n<p class=\"newsletter-widget__disclaimer__new-story-page text-size--tiny\">By signing up you consent to receive the above newsletter from Postmedia Network Inc.<\/p>\n<\/div>\n<div class=\"js-submit-success\" hidden=\"\" id=\"submitSuccessFP_HeadlineNews\">\n<p>Thanks for signing up!<\/p>\n<p class=\"newsletter-widget__text__new-story-page\">A welcome email is on its way. If you don&#8217;t see it, please check your junk folder.<\/p>\n<p class=\"newsletter-widget__text__new-story-page newsletter__feedback--last\">The next issue of Top Stories will soon be in your inbox.<\/p>\n<\/div>\n<p class=\"newsletter-widget__text__new-story-page js-submit-error\" style=\"margin-top: 8px\" hidden=\"\" id=\"submitErrorFP_HeadlineNews\">We encountered an issue signing you up. Please try again<\/p>\n<\/div>\n<\/div>\n<\/section>\n<\/div>\n<section class=\"article-content__content-group article-content__content-group--story\">\n<p>Article content<\/p>\n<\/section>\n<div class=\"ad__section-border article-content__ad-group ad_counter_3\">\n<section aria-describedby=\"advertisment3848822097503118339958805406679040\" class=\"ad\">\n<p>Advertisement 3<\/p>\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]]\" data-aqa=\"advertisement\" 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<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/section>\n<\/div>\n<section class=\"article-content__content-group article-content__content-group--story\">\n<p>Article content<\/p>\n<p data-async=\"\">If you don\u2019t think the Bank of Canada can cut rates without help from the United States Federal Reserve, think again. This happened in 1996-1997, 1999 and 2003-2004. How far can it deviate? Well, let\u2019s just say that in early 1997, with the Canadian economy heading into a different orbit than the U.S. under the budget belt tightening by the Jean Chr\u00e9tien-Paul Martin dynamic duo, the overnight rate in Canada got as low as three per cent while the Fed funds rate was pinned at 5.5 per cent. There is precedent.<\/p>\n<p data-async=\"\">As for the Canadian dollar, well, sure, it will depreciate, and in two of those prior periods of monetary policy divergence (1999 and 2003), it took almost $1.50 to buy a U.S. dollar. What of it? The economy needs stimulus and currency depreciation is one key to easing domestic monetary conditions. Besides, we are so damned uncompetitive in this country, with negative productivity growth and no capital deepening at all for well over a decade, that unit labour costs in U.S. dollar terms are running at five per cent year over year, which compares very poorly to the 1.8 per cent trend south of the border.<\/p>\n<\/section>\n<div class=\"ad__section-border article-content__ad-group ad_counter_4\">\n<section aria-describedby=\"advertisment3185699873310691067395019791925248\" class=\"ad\">\n<p>Advertisement 4<\/p>\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]]\" data-aqa=\"advertisement\" 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<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/section>\n<\/div>\n<section class=\"article-content__content-group article-content__content-group--story\">\n<p>Article content<\/p>\n<p>Even without the Bank of Canada going its own way, the country sadly needs a weaker exchange rate as an ongoing crutch just to realign our cost structure with the U.S. and stem the tide of net direct investment outflows. In other words, we are sure nobody is even aware of the dramatic erosion that has taken place when it comes to net direct investment (this is \u201cbricks and mortar,\u201d not paper securities), but there has been a net outflow of real capital out of the country each and every year since 2014 totalling nearly $400 billion (more than $50 billion alone in 2023).<\/p>\n<p>This is why the Canadian dollar remains in a fundamental bear market and why it is that even in periods when oil and industrial commodities hook up, there is a muted Canadian dollar response. It is not because the \u201cterms of trade\u201d effect is broken as much as it has been weakened by this relentless decay in domestic competitiveness relative to the U.S.<\/p>\n<p>In other words, we have to cut our prices internationally just to protect our share of the global export market, and in the process, the nation is compelled to accept a wage cut, and there was nothing in the recent federal budget to address this chronic shortfall in terms of domestic competitiveness.<\/p>\n<\/section>\n<div class=\"ad__section-border article-content__ad-group ad_counter_5\">\n<section aria-describedby=\"advertisment3831984543909807476279213501186048\" class=\"ad\">\n<p>Advertisement 5<\/p>\n<div class=\"ad__container\">\n<div class=\"ad__inner\" id=\"ad__inner-5\">\n<div class=\"ad__inner__container\" data-ad=\"[[1200,250],[1200,90],[970,90],[970,250],[728,90],[300,250]]\" data-ad-loc=\"5\" data-ad-mobile=\"[[320,50],[300,50],[300,250]]\" data-aqa=\"advertisement\" id=\"ad-5\" 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<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/section>\n<\/div>\n<section class=\"article-content__content-group article-content__content-group--story\">\n<p>Article content<\/p>\n<p>It would be funny if it weren\u2019t so sad that economic documents such as the budget turn into political manifestos aimed at buying votes in the name of \u201cfairness\u201d over \u201cgrowth.\u201d<\/p>\n<section aria-labelledby=\"moreTopicLabel4266115867673456574900668117024768\" class=\"more-topic\" data-aqa=\"embed-more-topic\" data-carousel-component=\"\" data-carousel-icon-button=\"\" data-carousel-type=\"list\">\n<p>Recommended from Editorial<\/p>\n<p><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 data-evt-val=\"{\" control_fields=\"\" the=\"\" bank=\"\" of=\"\" canada=\"\" needs=\"\" to=\"\" start=\"\" cutting=\"\" rates=\"\" now=\"\" data-carousel-item=\"\" data-evt=\"click\" data-evt-typ=\"click\"> <picture class=\"more-topic__item-image\"><img decoding=\"async\" src=\"data:image\/gif;base64,R0lGODlhAQABAIAAAAAAAP\/\/\/ywAAAAAAQABAAACAUwAOw==\" fifu-lazy=\"1\" fifu-data-sizes=\"auto\" fifu-data-srcset=\"https:\/\/i1.wp.com\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2024\/05\/deflation-0403-ph.jpg?h=96&strip=all&quality=5&sig=MeJrWpfE0eYBSfE7CdHBRw&ssl=1&w=75&resize=75&ssl=1 75w, https:\/\/i1.wp.com\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2024\/05\/deflation-0403-ph.jpg?h=96&strip=all&quality=5&sig=MeJrWpfE0eYBSfE7CdHBRw&ssl=1&w=100&resize=100&ssl=1 100w, https:\/\/i1.wp.com\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2024\/05\/deflation-0403-ph.jpg?h=96&strip=all&quality=5&sig=MeJrWpfE0eYBSfE7CdHBRw&ssl=1&w=150&resize=150&ssl=1 150w, https:\/\/i1.wp.com\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2024\/05\/deflation-0403-ph.jpg?h=96&strip=all&quality=5&sig=MeJrWpfE0eYBSfE7CdHBRw&ssl=1&w=240&resize=240&ssl=1 240w, https:\/\/i1.wp.com\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2024\/05\/deflation-0403-ph.jpg?h=96&strip=all&quality=5&sig=MeJrWpfE0eYBSfE7CdHBRw&ssl=1&w=320&resize=320&ssl=1 320w, https:\/\/i1.wp.com\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2024\/05\/deflation-0403-ph.jpg?h=96&strip=all&quality=5&sig=MeJrWpfE0eYBSfE7CdHBRw&ssl=1&w=500&resize=500&ssl=1 500w, https:\/\/i1.wp.com\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2024\/05\/deflation-0403-ph.jpg?h=96&strip=all&quality=5&sig=MeJrWpfE0eYBSfE7CdHBRw&ssl=1&w=640&resize=640&ssl=1 640w, https:\/\/i1.wp.com\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2024\/05\/deflation-0403-ph.jpg?h=96&strip=all&quality=5&sig=MeJrWpfE0eYBSfE7CdHBRw&ssl=1&w=800&resize=800&ssl=1 800w, https:\/\/i1.wp.com\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2024\/05\/deflation-0403-ph.jpg?h=96&strip=all&quality=5&sig=MeJrWpfE0eYBSfE7CdHBRw&ssl=1&w=1024&resize=1024&ssl=1 1024w, https:\/\/i1.wp.com\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2024\/05\/deflation-0403-ph.jpg?h=96&strip=all&quality=5&sig=MeJrWpfE0eYBSfE7CdHBRw&ssl=1&w=1280&resize=1280&ssl=1 1280w, https:\/\/i1.wp.com\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2024\/05\/deflation-0403-ph.jpg?h=96&strip=all&quality=5&sig=MeJrWpfE0eYBSfE7CdHBRw&ssl=1&w=1600&resize=1600&ssl=1 1600w\" alt=\"The primary risk in Canada is homegrown deflation as excess capacity builds, not inflation.\" data-src=\"https:\/\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2024\/05\/deflation-0403-ph.jpg?h=96&strip=all&quality=80&sig=1Xy2hCa5qvQApwF4DJcRMw\" fifu-data-src=\"https:\/\/i1.wp.com\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2024\/05\/deflation-0403-ph.jpg?h=96&strip=all&quality=5&sig=MeJrWpfE0eYBSfE7CdHBRw&ssl=1\" srcset=\"https:\/\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2024\/05\/deflation-0403-ph.jpg?h=96&strip=all&quality=80&sig=1Xy2hCa5qvQApwF4DJcRMw, https:\/\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2024\/05\/deflation-0403-ph.jpg?h=192&strip=all&quality=80&sig=vVoXEL3WqBWW3jNe4dqtjQ 2x,\n                                             https:\/\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2024\/05\/deflation-0403-ph.jpg?h=288&strip=all&quality=80&sig=KLGOaK5RIBXtzZnSbz03mw 3x\" class=\"lazyload\" height=\"96\" loading=\"lazy\" width=\"96\"\/><\/picture>\n<p><span class=\"more-topic__item-text-clamp\">Why the Bank of Canada needs to start cutting rates \u2026 Now<\/span><\/p>\n<\/li>\n<li data-evt-val=\"{\" control_fields=\"\" rosenberg:=\"\" time=\"\" for=\"\" macklem=\"\" to=\"\" turn=\"\" before=\"\" it=\"\" too=\"\" late=\"\" data-carousel-item=\"\" data-evt=\"click\" data-evt-typ=\"click\"> <picture class=\"more-topic__item-image\"><img decoding=\"async\" src=\"data:image\/gif;base64,R0lGODlhAQABAIAAAAAAAP\/\/\/ywAAAAAAQABAAACAUwAOw==\" fifu-lazy=\"1\" fifu-data-sizes=\"auto\" fifu-data-srcset=\"https:\/\/i2.wp.com\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2024\/04\/no0417macklem.jpg?h=96&strip=all&quality=5&sig=bOM5TToEZmZlFhcT3FjDYQ&ssl=1&w=75&resize=75&ssl=1 75w, https:\/\/i2.wp.com\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2024\/04\/no0417macklem.jpg?h=96&strip=all&quality=5&sig=bOM5TToEZmZlFhcT3FjDYQ&ssl=1&w=100&resize=100&ssl=1 100w, https:\/\/i2.wp.com\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2024\/04\/no0417macklem.jpg?h=96&strip=all&quality=5&sig=bOM5TToEZmZlFhcT3FjDYQ&ssl=1&w=150&resize=150&ssl=1 150w, https:\/\/i2.wp.com\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2024\/04\/no0417macklem.jpg?h=96&strip=all&quality=5&sig=bOM5TToEZmZlFhcT3FjDYQ&ssl=1&w=240&resize=240&ssl=1 240w, https:\/\/i2.wp.com\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2024\/04\/no0417macklem.jpg?h=96&strip=all&quality=5&sig=bOM5TToEZmZlFhcT3FjDYQ&ssl=1&w=320&resize=320&ssl=1 320w, https:\/\/i2.wp.com\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2024\/04\/no0417macklem.jpg?h=96&strip=all&quality=5&sig=bOM5TToEZmZlFhcT3FjDYQ&ssl=1&w=500&resize=500&ssl=1 500w, https:\/\/i2.wp.com\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2024\/04\/no0417macklem.jpg?h=96&strip=all&quality=5&sig=bOM5TToEZmZlFhcT3FjDYQ&ssl=1&w=640&resize=640&ssl=1 640w, https:\/\/i2.wp.com\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2024\/04\/no0417macklem.jpg?h=96&strip=all&quality=5&sig=bOM5TToEZmZlFhcT3FjDYQ&ssl=1&w=800&resize=800&ssl=1 800w, https:\/\/i2.wp.com\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2024\/04\/no0417macklem.jpg?h=96&strip=all&quality=5&sig=bOM5TToEZmZlFhcT3FjDYQ&ssl=1&w=1024&resize=1024&ssl=1 1024w, https:\/\/i2.wp.com\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2024\/04\/no0417macklem.jpg?h=96&strip=all&quality=5&sig=bOM5TToEZmZlFhcT3FjDYQ&ssl=1&w=1280&resize=1280&ssl=1 1280w, https:\/\/i2.wp.com\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2024\/04\/no0417macklem.jpg?h=96&strip=all&quality=5&sig=bOM5TToEZmZlFhcT3FjDYQ&ssl=1&w=1600&resize=1600&ssl=1 1600w\" alt=\"Bank of Canada governor Tiff Macklem at a press conference in Ottawa.\" data-src=\"https:\/\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2024\/04\/no0417macklem.jpg?h=96&strip=all&quality=80&sig=DvcASaT4jBZeqqhMgxxTYg\" fifu-data-src=\"https:\/\/i2.wp.com\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2024\/04\/no0417macklem.jpg?h=96&strip=all&quality=5&sig=bOM5TToEZmZlFhcT3FjDYQ&ssl=1\" srcset=\"https:\/\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2024\/04\/no0417macklem.jpg?h=96&strip=all&quality=80&sig=DvcASaT4jBZeqqhMgxxTYg, https:\/\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2024\/04\/no0417macklem.jpg?h=192&strip=all&quality=80&sig=QAwMPlb9N9Xwoo9hU6_smQ 2x,\n                                             https:\/\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2024\/04\/no0417macklem.jpg?h=288&strip=all&quality=80&sig=AaMbpI9ZoQjvjGYLKhXpTA 3x\" class=\"lazyload\" height=\"96\" loading=\"lazy\" width=\"96\"\/><\/picture>\n<p><span class=\"more-topic__item-text-clamp\">David Rosenberg: Time for Macklem to turn before it\u2019s too late<\/span><\/p>\n<\/li>\n<li data-evt-val=\"{\" control_fields=\"\" was=\"\" once=\"\" productive=\"\" and=\"\" competitive=\"\" but=\"\" not=\"\" today=\"\" data-carousel-item=\"\" data-evt=\"click\" data-evt-typ=\"click\"> <picture class=\"more-topic__item-image\"><img decoding=\"async\" src=\"data:image\/gif;base64,R0lGODlhAQABAIAAAAAAAP\/\/\/ywAAAAAAQABAAACAUwAOw==\" fifu-lazy=\"1\" fifu-data-sizes=\"auto\" fifu-data-srcset=\"https:\/\/i1.wp.com\/smartcdn.gprod.postmedia.digital\/nationalpost\/wp-content\/uploads\/2024\/03\/trudeau-productivity-canada-1.jpg?h=96&strip=all&quality=5&sig=R5gj1BTmQI-rPxMcnMOy7w&ssl=1&w=75&resize=75&ssl=1 75w, https:\/\/i1.wp.com\/smartcdn.gprod.postmedia.digital\/nationalpost\/wp-content\/uploads\/2024\/03\/trudeau-productivity-canada-1.jpg?h=96&strip=all&quality=5&sig=R5gj1BTmQI-rPxMcnMOy7w&ssl=1&w=100&resize=100&ssl=1 100w, https:\/\/i1.wp.com\/smartcdn.gprod.postmedia.digital\/nationalpost\/wp-content\/uploads\/2024\/03\/trudeau-productivity-canada-1.jpg?h=96&strip=all&quality=5&sig=R5gj1BTmQI-rPxMcnMOy7w&ssl=1&w=150&resize=150&ssl=1 150w, https:\/\/i1.wp.com\/smartcdn.gprod.postmedia.digital\/nationalpost\/wp-content\/uploads\/2024\/03\/trudeau-productivity-canada-1.jpg?h=96&strip=all&quality=5&sig=R5gj1BTmQI-rPxMcnMOy7w&ssl=1&w=240&resize=240&ssl=1 240w, https:\/\/i1.wp.com\/smartcdn.gprod.postmedia.digital\/nationalpost\/wp-content\/uploads\/2024\/03\/trudeau-productivity-canada-1.jpg?h=96&strip=all&quality=5&sig=R5gj1BTmQI-rPxMcnMOy7w&ssl=1&w=320&resize=320&ssl=1 320w, https:\/\/i1.wp.com\/smartcdn.gprod.postmedia.digital\/nationalpost\/wp-content\/uploads\/2024\/03\/trudeau-productivity-canada-1.jpg?h=96&strip=all&quality=5&sig=R5gj1BTmQI-rPxMcnMOy7w&ssl=1&w=500&resize=500&ssl=1 500w, https:\/\/i1.wp.com\/smartcdn.gprod.postmedia.digital\/nationalpost\/wp-content\/uploads\/2024\/03\/trudeau-productivity-canada-1.jpg?h=96&strip=all&quality=5&sig=R5gj1BTmQI-rPxMcnMOy7w&ssl=1&w=640&resize=640&ssl=1 640w, https:\/\/i1.wp.com\/smartcdn.gprod.postmedia.digital\/nationalpost\/wp-content\/uploads\/2024\/03\/trudeau-productivity-canada-1.jpg?h=96&strip=all&quality=5&sig=R5gj1BTmQI-rPxMcnMOy7w&ssl=1&w=800&resize=800&ssl=1 800w, https:\/\/i1.wp.com\/smartcdn.gprod.postmedia.digital\/nationalpost\/wp-content\/uploads\/2024\/03\/trudeau-productivity-canada-1.jpg?h=96&strip=all&quality=5&sig=R5gj1BTmQI-rPxMcnMOy7w&ssl=1&w=1024&resize=1024&ssl=1 1024w, https:\/\/i1.wp.com\/smartcdn.gprod.postmedia.digital\/nationalpost\/wp-content\/uploads\/2024\/03\/trudeau-productivity-canada-1.jpg?h=96&strip=all&quality=5&sig=R5gj1BTmQI-rPxMcnMOy7w&ssl=1&w=1280&resize=1280&ssl=1 1280w, https:\/\/i1.wp.com\/smartcdn.gprod.postmedia.digital\/nationalpost\/wp-content\/uploads\/2024\/03\/trudeau-productivity-canada-1.jpg?h=96&strip=all&quality=5&sig=R5gj1BTmQI-rPxMcnMOy7w&ssl=1&w=1600&resize=1600&ssl=1 1600w\" alt=\"Prime Minister Justin Trudeau. Total factor productivity in Canada, under this current government in Ottawa, is now back to where it was a quarter-century ago, David Rosenberg says.\" data-src=\"https:\/\/smartcdn.gprod.postmedia.digital\/nationalpost\/wp-content\/uploads\/2024\/03\/trudeau-productivity-canada-1.jpg?h=96&strip=all&quality=80&sig=JxJLymZB1b0rogGdMA5GeA\" fifu-data-src=\"https:\/\/i1.wp.com\/smartcdn.gprod.postmedia.digital\/nationalpost\/wp-content\/uploads\/2024\/03\/trudeau-productivity-canada-1.jpg?h=96&strip=all&quality=5&sig=R5gj1BTmQI-rPxMcnMOy7w&ssl=1\" srcset=\"https:\/\/smartcdn.gprod.postmedia.digital\/nationalpost\/wp-content\/uploads\/2024\/03\/trudeau-productivity-canada-1.jpg?h=96&strip=all&quality=80&sig=JxJLymZB1b0rogGdMA5GeA, https:\/\/smartcdn.gprod.postmedia.digital\/nationalpost\/wp-content\/uploads\/2024\/03\/trudeau-productivity-canada-1.jpg?h=192&strip=all&quality=80&sig=zaNZC5M5SFvrfFiXQD_Q9A 2x,\n                                             https:\/\/smartcdn.gprod.postmedia.digital\/nationalpost\/wp-content\/uploads\/2024\/03\/trudeau-productivity-canada-1.jpg?h=288&strip=all&quality=80&sig=Ga4r2t__2zy6_nmIGh-11g 3x\" class=\"lazyload\" height=\"96\" loading=\"lazy\" width=\"96\"\/><\/picture>\n<p><span class=\"more-topic__item-text-clamp\">Canada was once productive and competitive, but not today<\/span><\/p>\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 data-async=\"\">How is it that the Liberals are so adept at divvying up the national income pie instead of thinking creatively to expand it. It\u2019s as if the term \u201cproductivity\u201d to the politicians, bureaucrats and mandarins in Canada is a dirty 12-letter word. Better to pursue supply-side growth through an unprecedented immigration policy stance (never mind that there has been no economic payback, judging by the continuous contraction in real output and income in per-capita terms) than embark on measures to bolster productivity growth, which is the mother\u2019s milk for future prosperity. But why bother when nobody outside the realm of economics even understands what productivity means, and it\u2019s neither an attention grabber in election campaigns nor a vote getter at the polls.<\/p>\n<p>Brian Mulroney and Michael Wilson got it. Chretien and Martin got it. But Justin Trudeau and Chrystia Freeland? Not so much.<\/p>\n<p data-async=\"\"><em>David Rosenberg is founder and president of independent research firm Rosenberg Research &amp; Associates Inc. To receive more of David Rosenberg\u2019s insights and analysis, you can sign up for a complimentary, one-month trial on the Rosenberg Research website.<\/em><\/p>\n<p data-async=\"\"><em><strong>Bookmark our website and support our journalism:<\/strong> Don\u2019t miss the business news you need to know \u2014 add financialpost.com to your bookmarks and sign up for our newsletters here.<\/em><\/p>\n<\/section>\n<section class=\"article-content__content-group article-content__content-group--story\">\n<p>Article content<\/p>\n<\/section>\n<section class=\"article-content__share-group article-delimiter\" data-evt-val=\"{\" control_fields=\"\" data-evt-typ=\"page_scroll\">\n<p>Share this article in your social network<\/p>\n<\/section>\n<\/div>\n\n<br \/>Bank of Canada should cut rates with or without the Fed<\/a><br \/>\n<br \/>2024-05-07 15:15:55<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Breadcrumb Trail Links Economy Canada can cope with a weaker dollar; in fact the country needs it Published May 07, 2024 \u00a0\u2022\u00a0 Last updated 1\u00a0hour ago \u00a0\u2022\u00a0 4 minute read&#8230;<\/p>\n","protected":false},"author":2,"featured_media":46761,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"fifu_image_url":"https:\/\/smartcdn.gprod.postmedia.digital\/financialpost\/wp-content\/uploads\/2024\/05\/macklem-powell-0507-ph.jpeg?quality=90&strip=all&w=288&h=216&sig=O8M1_fiTvi6OqbpE0DBN0Q","fifu_image_alt":"","footnotes":""},"categories":[31],"tags":[],"class_list":["post-46760","post","type-post","status-publish","format-standard","has-post-thumbnail","category-economy"],"_links":{"self":[{"href":"https:\/\/www.pantheregroup.com\/api\/wp\/v2\/posts\/46760","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.pantheregroup.com\/api\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.pantheregroup.com\/api\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.pantheregroup.com\/api\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.pantheregroup.com\/api\/wp\/v2\/comments?post=46760"}],"version-history":[{"count":0,"href":"https:\/\/www.pantheregroup.com\/api\/wp\/v2\/posts\/46760\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.pantheregroup.com\/api\/wp\/v2\/media\/46761"}],"wp:attachment":[{"href":"https:\/\/www.pantheregroup.com\/api\/wp\/v2\/media?parent=46760"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.pantheregroup.com\/api\/wp\/v2\/categories?post=46760"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.pantheregroup.com\/api\/wp\/v2\/tags?post=46760"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}