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Interest rates are up, inflation is down – what is going on?

  • The Globe and Mail
  • |
  • Aug 8, 2017
Interest rates are up, inflation is down – what is going on?

Stephen Poloz, the Governor of the Bank of Canada, raised interest rates in July, and there's a strong possibility it will happen again in October.

But why?

"The shift has prompted some pundits to ask why rates are rising when inflation is still well below the bank’s two-per-cent target. But rising inflation is only one of the factors that may cause an increase in interest rates," says Professor George Athanassakos.

Athanassakos explains the whole story in his column in The Globe and Mail.