20 Feb 2015
Inflation may dip into negative territory for a brief interval – BOC’s Cote
FXStreet (Mumbai) - In a speech at the Quebec Technology Association on Thursday, the Bank of Canada’s (BOC) Deputy Governor Agathe Cote said that lower oil prices could shock the Canadian economy and force inflation into negative territory, even if for a brief period of time.
Key Quotes:
"In light of the volatility of oil prices, it is possible that inflation will dip into negative territory for a brief interval,"
“(although) would not constitute deflation, which requires a generalized decline in prices."
"This shock will delay the economy’s return to full capacity by undermining both investment in the oil sector and gross domestic income,”
"That (interest rate) decision will be based on a careful examination of how the economy and the risks are evolving."
Key Quotes:
"In light of the volatility of oil prices, it is possible that inflation will dip into negative territory for a brief interval,"
“(although) would not constitute deflation, which requires a generalized decline in prices."
"This shock will delay the economy’s return to full capacity by undermining both investment in the oil sector and gross domestic income,”
"That (interest rate) decision will be based on a careful examination of how the economy and the risks are evolving."