The Canadian dollar was trundling along at about 78 US cents on the morning of March 13 when the highlights of Bank of Canada Governor Stephen Poloz’s latest remarks flashed across Bloomberg and Reuters terminals.
“After looking at a much wider range of labour market indicators, the Bank has concluded that there remains a degree of untapped supply potential in the economy,” Poloz said in the text of the speech he was about to read at Queen’s University in Kingston, Ontario. “This is important, for it means that Canada may be able to have more economic growth, a larger economy, and therefore more income per person, without generating higher inflation.”
The value of the currency plunged to about 77 US cents, where it stayed for the rest of the day.
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