Government of Canada Renews Inflation-Target Agreement With the Bank of Canada

The Government of Canada and the Bank of Canada have agreed to renew Canada’s flexible inflation-target regime for another five years to the end of 2016. Under the renewed agreement, the inflation target will continue to be the 2 per cent mid-point of the 1 to 3 per cent inflation-control range.

“At a time of continuing global economic uncertainty, it is more important than ever to provide a stable economic environment that bolsters confidence and supports growth,” said Minister Flaherty. “The flexible approach to inflation targeting we have in Canada helps create these conditions, and together with our strong financial institutions and sound public finances, represents strong economic fundamentals that are recognized around the globe. Low, stable and predictable inflation benefits households and businesses through lower mortgage and loan costs.”