Canadian interest rates could rise again if inflation continues to increase, says Bank of Canada Governor Tiff Macklem.
In a speech to the Calgary Chamber of Commerce on Thursday, Macklem said higher interest rates are helping to cool demand and return inflation to the central bank’s 2% target. But the central bank remains concerned about underlying inflationary pressures.
Therefore, the bank may need to increase interest rates again if the inflationary pressures persist.
Macklem’s comments came one day after the bank held its benchmark interest rate at 5% after five increases in as many months. Another BoC rate hike would have implications for the commercial real estate industry as nervous investors and developers seek interest-rate stability and lending-cost certainty.
Commercial real estate investment has waned across Canada this year as rising interest rates continue to erode investor and developer confidence.
Monte Stewart serves as Content Director - Canada for Connect Commercial Real Estate.
Based in Vancouver, British Columbia, Monte provides daily news coverage of major Canadian commercial real estate markets, including Vancouver, Toronto, Montreal and Calgary. He has written about the real estate sector for various media outlets and Avison Young since the early 2000s.
In addition, he has covered sports, general news and business for several leading wire services and publications, including The Canadian Press, The Associated Press, The Calgary Herald, The Globe and Mail, Research Money, The Daily Oil Bulletin, Natural Gas World and The Toronto Star.
Monte is active in his community as a youth basketball coach and raises funds for such charitable causes as Movember.