Bank of Canada in risk management mode with stagflation on the table, Poloz says
Former Bank of Canada governor Stephen Poloz said the central bank is operating in “risk management mode,” noting that with both “downside risks to economic growth and upside risks to inflation,” policymakers are “more likely to do very little.” He warned that the U.S. trade war has created a “tricky environment” for Canada and described current conditions as “a stagflation shock,” adding, “we don’t know how deep of a stagflation it will be, but it could be more stag than inflation.” Poloz also cautioned about the future of Canada’s auto industry. “I’m more confident about the parts sector being present 10 years from now, than about the final stage — the assembly sector,” he said.
