We need to step back and look at the Bank of Canada's core mandate, which is to maintain inflation at a stable level of around 2% over the medium and long term.
Inflation has soared. The cost of living has risen dramatically in recent years, which plays a role in this and contributes to the difficulties facing many Canadians today.
Now that we've seen the impact of high interest rates, cooled the economy and brought inflation down, we're getting closer to a victory in this area. We aren't there yet, but we're getting there. As a result, we're expecting the Bank of Canada to start lowering its policy interest rate soon and to ultimately set the rate at more neutral levels. The rate could be a few percentage points lower than its current level. This should ease the pressure on many households, such as those households in British Columbia and other places facing drastic mortgage rate hikes.