After the premiers of Ontario, British Columbia and Newfoundland and Labrador sent letters to the central bank governor in September asking the bank not to raise interest rates any further, Macklem wrote back on Sept. 13 asking them to stop undermining the bank’s independence. (The Canadian Press)
Talking point: If people see the Bank of Canada as doing or defying politicians’ bidding, its decisions could quickly lose legitimacy. With another rate decision due tomorrow, Ontario’s Doug Ford sent another open letter over the weekend, arguing that rates should stay where they are. Raising borrowing costs is meant to fight inflation across the whole economy. With mortgages now much more expensive, Ford wrote, “that justification is wearing thin.” The bank didn’t raise interest rates further after the premiers last wrote, a move Finance Minister Chrystia Freeland publicly welcomed; Conservative Leader Pierre Poilievre has promised to replace Macklem as the head of the Bank of Canada.