On the program today, former TD Bank Chief Economist Don Drummond joins us. Don unpacks the latest Bank of Canada rate decision, its impact for future federal policy decisions, and the trajectory of the Canadian dollar. Don says the prolonged period of low interest rates has created a culture of indebtedness, which can be seen in lines of credit, business loans, and mortgage holders. He explains that investors should be looking at how much higher than normal these new rates actually are. In terms of the Canadian dollar, Don says that Canada’s 20% productivity deficiency means that the dollar should be priced at a 20% discount, but explains that deviations may occur depending on commodity prices.
Recorded on July 13, 2023.
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