Monday September 4, 2023 | VICTORIA, BC [Updated September 6, 2023]
by Mary P Brooke, Editor | Island Social Trends | BUSINESS & ECONOMY SECTION
After 10 interest rate hikes by the Bank of Canada in the last 18 months, most Canadian households and small businesses feel the pressure has become to much. There is very little wiggle room — if any — in household budgets and business operational finances.
The impact of higher interest rates has made its way into just about everything in the economy — but most notably affecting the cost of housing, groceries, and insurance.
Premiers speaking up:
BC Premier David Eby wrote a letter to the Bank of Canada last week asking for no further interest rate increases by the central bank. Yesterday Ontario Premier Doug Ford followed suit, and the Premier of Newfoundland and Labrador Andrew Furey also chimed in.
“I share the views of my colleague, Premier David Eby of British Columbia, that many families and businesses are struggling to make ends meet and cannot afford the crushing impact of any further rate hikes,” said Premier Ford.
“This is not an academic debate – increased rates hurt many people in our province,” said BC Premier Eby in a social media post after posting a copy of his letter that he sent to the Bank of Canada. “It’s not just homeowners. Renters, young people, seniors, families, small businesses, with car payments & lines of credit, are getting squeezed. Mortgage rates are already the biggest contributor to inflation. If pushed higher, it will be devastating for building new homes,” said Eby.
“People in B.C. are already hurting,” said Eby in his letter. “In your role as governor, I urge you to consider the full human impact of rate increases and not further increase rates at this time.”
Eby also wrote to the prime minister to urge him “to work with us to tackle the root causes of inflation”. Eby defined that as “building more homes for people, strengthening supply chains, and make it easier and cheaper to move goods.”
Federal NDP comment:
Federal NDP Leader Jagmeet Singh said last week in a national news conference from Sooke that the Bank of Canada mechanism of increasing interest rates is having negative impacts on people and small businesses living with the consequences of higher interest rates.
He delicately suggested that just doing something that sounds good in theory — without taking into account real impacts — was an error in judgement on the Bank’s part.
Next rate decision:
The next bank rate decision will be announced on Wednesday September 6 at 10 am Eastern (7 am PDT). That will be issued in a news release, without any webcast or media availability.
Bank of Canada Governor Tiff Macklem will take media questions the following day, on Thursday September 7, after addressing the Calgary Chamber of Commerce. That webcast will take place at 12:10 pm Mountain Time (11:10 am PDT).
===== RELATED:
Jagmeet visits Sooke to talk about cost of living (August 31, 2023)
Premier Eby on July 12 Bank of Canada rate increase (July 12, 2023)
10th Bank of Canada rate increase in 16 months (July 12, 2023)
Eby: Interest rate hikes impacting people who can least afford it (July 11, 2023)
Bank of Canada Deputy Governor draws a crowd in Victoria (June 8, 2023)