‘Try to overwhelm it’: Bank of Canada Governor reflects on navigating a COVID-19 economy – National

0


Whenever Tiff Macklem needs a break, he hops on the exercise bike he bought during the pandemic and does a hard workout to clear his mind.

The bicycle helped the Governor of the Bank of Canada through this crisis, a crisis where he could be forgiven for feeling like he was riding precariously on a dime.

Read more:

Bank of Canada will act to calm inflation if price hikes appear more permanent, governor says

Speaking to The Canadian Press this week, Macklem briefly touched on his first year as head of the central bank and some early lessons from the pandemic.

A year ago, Macklem took over from Stephen Poloz as governor as the country emerges from the first wave of COVID-19 and public health experts warn of more, potentially worse, waves to come .

The story continues under the ad


Click to play the video:







Coronavirus: Canadian economy could suffer in Q1 2021 with increase in COVID-19 infections


Coronavirus: Canadian economy could suffer in Q1 2021 with increase in COVID-19 infections – December 15, 2020

As Macklem noted, at the time there were more than two million unemployed Canadians, inflation was well outside the comfort zone of the bank, and although vaccines were in development, no one knew when they would be available or how effective they would be.

The federal government was spending billions of dollars in unprecedented spending to help hard-hit workers and businesses, while the central bank lowered its key rate to near zero to stimulate spending and bought bonds to keep markets functioning and further stimulate in the economy.

The Bank of Canada kept its key rate at 0.25% this week, saying it still does not see the economy ready for a rate hike until the second half of next year. However, it has further slowed the pace of its bond purchases, citing improving economic conditions and prospects.

The story continues under the ad

Read more:

Bank of Canada keeps key rate at 0.25%, cuts growth forecast for 2021

Macklem said the actions, including his comments last July that rates would stay low until the crisis was completely in the rearview mirror, were the result of lessons learned from the global financial crisis, which Macklem saw from first hand when he was second. Commander at the Bank of Canada.

“When you are hit by a real crisis, you have to try to overcome it. You need an overwhelming response, you need to go beyond normal responses, ”he said.

Help from the bank and governments has been essential in helping workers and businesses become smarter and the economy more resilient to subsequent waves of COVID-19, Macklem said.

Of course, Macklem has had to pedal alone on a tandem bike since Carolyn Wilkins stepped down as deputy governor in December. His replacement, Carolyn Rogers, will not join the central bank as Macklem’s No.2 until December 15.


Click to play the video:







Coronavirus: Bank of Canada expects lasting pandemic effect on economic growth


Coronavirus: Bank of Canada expects lasting pandemic effect on economic growth – October 28, 2020

The other lesson learned from the pandemic is the need for every part of the system – governments, the central bank and even frontline health workers – to play their part in managing the crisis, he said. .

The story continues under the ad

“You can’t have a healthy economy without healthy people. It starts there, ”Macklem said.

“We each have our roles, we each have our training, we need to do what we need to do within our responsibilities, but we also need to come together and work effectively on behalf of Canadians.”

Keeping in touch with the concerns of the average Canadian isn’t easy at the best of times for someone in Macklem’s position, but he said the move to virtual meetings has made it easier to reach people in different parts of the country.

Read more:

Bank of Canada appoints Carolyn Rogers as new Senior Assistant

In some ways, it’s a bit like how he described his life as the dean of the University of Toronto’s Rotman School of Management just before returning to banking last year. He could move around a building teeming with students overflowing with questions and ideas.

It was an experience that broadened, Macklem said, and where he saw impacts over a short period of time, with students graduating after a few years. Policy making, he said, is a bit more abstract and without the personal connection it had to university.

“I really can’t wait to get back to more experiences in person,” Macklem said, “but I think there are some lasting lessons we can learn from it and how you can engage in a great country and make it happen. a better job of engaging with the full diversity of Canadians.

© 2021 The Canadian Press


Share.

Leave A Reply