The Bank of Canada announced another oversized interest-rate hike yesterday and said that it is prepared to “act more forcefully if needed,” signalling that it intends to keep pushing borrowing costs rapidly higher in an effort to bring inflation back under control.
The central bank’s governing council voted to raise the policy rate by half a percentage point – its third interest-rate increase this year. That brings the benchmark rate to 1.5 per cent, just a quarter point below the prepandemic level.
The move was widely expected by analysts and investors. But the tone of the statement was striking. The central bank warned that the rate of inflation will likely move higher in the coming months, led by a jump in food and energy prices, and cautioned that “the risk of elevated inflation becoming entrenched has risen.”
- Canada’s big banks expect billions in added income after interest-rates hike
- David Parkinson: Bank of Canada will need to show its tough medicine to tackle inflation is working
- Rob Carrick: How real estate investors and speculators helped trigger the onslaught of soaring interest rates
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Morneau criticizes Liberals’ economic policies in first public speech since leaving political life
Former finance minister Bill Morneau delivered a pointed critique of the federal Liberals’ economic policies, along with a series of recommendations for kickstarting growth, in his first public speech since leaving political life two years ago.
Morneau, finance minister in the Liberal government from 2015 to 2020, echoed the concerns of business leaders who have urged Prime Minister Justin Trudeau to focus on expanding the Canadian economy, rather than rolling out tax-and-spend initiatives.
“There is no real sense of urgency in Ottawa about our lack of competitiveness,” Morneau said in a speech yesterday to the C.D. Howe Institute. “It’s not that this is one of the big problems facing Canada’s economy, it’s that this is our fundamental problem. Nothing else is solvable if we don’t put this issue first.”
It’s election day in Ontario
The provincial election in Ontario is today, June 2. Polls open at 9 a.m. and will close at 9 p.m. ET. The Globe will have live coverage throughout the day until there’s a result. Our team of reporters and columnists will bring you the latest news and what it all means.
Ontario’s two main opposition leaders made last-ditch appeals to voters on Wednesday in their attempt to unseat Progressive Conservative Leader Doug Ford.
Here’s what you need to know about the PC, NDP, Liberal and Green leaders, the party platforms, campaign staff and more.
Canadian company Xanadu achieves ‘big leap forward’ in quantum computer race
Xanadu Quantum Technologies, one of several companies trying to harness the ephemeral nature of quantum physics to revolutionize the computer industry, has hit an elusive milestone with a device that can outperform any supercomputer in the world at a specific task.
In a paper published yesterday in the research journal Nature, the Canadian company described how its machine, a quantum computer dubbed Borealis, achieved “quantum advantage” – a term that means it delivered a result beyond the practical reach of a conventional computer system.
Specifically, Borealis provided a series of numbers with a specified range of probability in just 36 millionths of a second, an operation that would take the world’s most powerful supercomputers more than 9,000 years to match. The feat does not have immediate application, but scientists at Xanadu had to surmount several key challenges to accomplish it.
ALSO ON OUR RADAR
Flair Airlines to continue flying after regulator approves U.S. control limits: Canada’s transportation regulator has allowed Flair Airlines to continue flying passengers after the Edmonton-based carrier agreed to make changes that loosen the grip of its U.S. investor and comply with the laws over foreign ownership of airlines.
Liberals throw support behind forced-labour bill: Prime Minister Justin Trudeau’s Liberals have thrown their support behind a Senate bill requiring government and businesses to annually report on steps they have taken to identify forced labour in their supply chains.
Britain to celebrate Queen’s Platinum Jubilee: Britain is getting ready for a four-day party this week to celebrate the Queen’s Platinum Jubilee and commemorate her 70 years on the throne. It’s a celebration like no other for the 96-year-old monarch. More than 2,700 events have been planned across the U.K. from June 2 to June 5, ranging from hundreds of community tea parties to a couple of drag queen bingos and a punk rock festival. Pubs will be open longer, bells will ring out and there will be plenty of kitschy souvenirs for sale.
Tim Hortons violated law in tracking people with app: Canada’s largest fast-food chain violated privacy laws by tracking people who used its app, gathering their location data hundreds of times a day – even when the app was not in use. That is the finding of a joint investigation by Canadian privacy officials into Tim Hortons’ surveillance of customers through an app installed on millions of mobile phones.
Ontario’s right-to-disconnect policy takes effect today: Ontario employers that are now legally obligated to have a right-to-disconnect policy have tended to craft it in a broad fashion, rather than provide specific mechanics of how and when employees can switch off from work, according to advisers who have helped design such documents.
Experts expect bad year for ticks in Canada: The prevalence of ticks that can carry Lyme disease is expected to be higher than ever in much of Canada this year, researchers say. Researcher Vett Lloyd says that as the impacts of climate change progress, each tick season will likely be worse than the last.
John Hinckley to get full freedom: John Hinckley Jr., who shot former United States president Ronald Reagan in 1981, is “no longer a danger to himself or others” and will be freed from all restrictions this month, a federal judge said yesterday, capping Mr. Hinckley’s four-decade journey through the legal and mental health systems.
World share steady: World shares were largely steady on Thursday after recent weakness as a drop in oil prices on bets Saudi Arabia may boost production helped balance concerns over surging inflation and monetary policy tightening. Just before 6 a.m. ET, Germany’s DAX was up 0.83 per cent. France’s CAC 40 gained 0.99 per cent. Markets in the U.K. were closed. In Asia, Japan’s Nikkei slid 0.16 per cent. Hong Kong’s Hang Seng lost 1 per cent. New York futures were positive. The Canadian dollar was trading at 79 US cents.
WHAT EVERYONE’S TALKING ABOUT
Editorial: “Through the long overdose epidemic, Canadian governments have consistently acted too slowly – there’s been watching, waiting and looking away. Tuesday was different. What’s coming in B.C. is a small experiment with potentially momentous positive results. A lot more is necessary.”
Cathal Kelly: “In sports, you’re only a traitor if your turncoating doesn’t work out. So it’s too soon to say exactly what we should call Johnson. But I’m sure the PGA Tour has a few suggestions.”
TODAY’S EDITORIAL CARTOON
Which of these foods packs the most nutritional heft?
When deciding between two healthy foods at the grocery store, you can’t always tell which one offers the biggest nutrition bang for your buck. That’s certainly true for foods that don’t display nutrition facts. Take a few minutes to test your nutrition smarts. Which of these foods offer the best overall nutritional value?
MOMENT IN TIME: JUNE 2, 1953
Elizabeth II crowned Queen at age 27
It was a moment in history not just for the monarchy, but for the BBC; on this day in 1953, 27-year-old Queen Elizabeth II became the first monarch ever to have their coronation broadcast live on television. The Queen’s Westminster Abbey coronation took place 16 months after she officially acceded to the throne, following the death of her father King George VI (who had himself taken the throne after the abdication of his brother Edward). It was a ceremony that was as regal as it was traditional and precisely choreographed, attended by a procession of nobility and royals – including the Queen’s husband, Prince Philip – within the chapel, while throngs of citizens gathered outside. More still gathered around their television sets: when St. Edward’s Crown, which is only ever used for coronation ceremonies and never worn in public, was placed on the Queen’s head by the Archbishop of Canterbury, an estimated 10 million British citizens were watching live. And while the Queen’s reign has been marked by ups and downs, including conflict at home and abroad, she has continued to hold her seat on the throne – though, in recent years, she’s taken a step back from her royal duties. After 70 years on the throne, she is the longest-reigning monarch in British history. Rebecca Tucker