The Bank of Canada today published a report summarizing the feedback it received from stakeholders and the Canadian public during consultations on its monetary policy framework.
Every five years, the Bank of Canada and the Government of Canada review and renew the agreement on Canada’s monetary policy framework. The agreement will be renewed before the end of 2026. In preparation, the Bank held consultations to gather views on inflation, monetary policy and on three key challenges to Canada’s economy that were the focus of the Bank’s research.
- In a world with more adverse supply shocks affecting inflation dynamics and economic activity, how should monetary policy respond?
- In a world more prone to volatility, how should the Bank assess and communicate about inflation? What measures of core inflation are most robust to structural changes in the economy?
- How does monetary policy affect housing demand and supply, and how is inflation in shelter prices measured and interpreted for policy purposes?
Conversations were held in communities across the country to better understand Canadians’ recent experience with inflation and to hear their perspectives on monetary policy. The Bank also met with a broad group of stakeholders including members of the research community, the private sector and civil society.
The feedback the Bank received indicates that Canadians value the stability the framework provides. Support for maintaining flexible inflation targeting and the 2% inflation target was strong. At the same time, many participants expressed concerns about the high cost of living and housing affordability. They indicated that clear communication about the information the Bank uses to make interest rate decisions is key to fostering trust in the central bank.
“It was important for the Bank to hear from Canadians as part of this process because inflation and interest rate decisions affect their day-to-day lives,” said Governor Tiff Macklem. “I’m thankful to everyone who participated in these consultations and for the value these perspectives will bring to the renewal of our policy framework.”
Read the full report.
