Central Bank Governor McDermott: Immigration reform has little impact on inflation

On October 26th, Jinshi data reported that the decision of the Canadian Central Bank Governor McCallum to reduce the immigration target set by the federal government will have a moderate impact on the economy, but the impact on inflation may be limited. McCallum stated in an interview with reporters that population growth has an impact on both the supply and demand of the economy. ‘One thing I want to emphasize is that inflation forecasts are not influenced by population growth,’ said McCallum. He also stated that the Central Bank has taken into account the significant slowdown in population growth and said he ‘will not exaggerate’ the difference between the Bank’s forecasts and the federal government’s announcements. He added that officials will continue to update and monitor the situation’s development and said ‘there is uncertainty about how fast these things will develop.’ ‘Overall, we believe that the risks to our forecasts are balanced, and if economic developments are broadly in line with our forecasts, we expect to further lower the interest rate policy,’ said McCallum. As for the expectation of interest rates, McCallum said he is currently ‘satisfied’ with the difference in timing and pace of interest rate cuts between the Central Bank and the Federal Reserve.