BoC Sees Growing Risk That High Rates May Push Inflation Below 2%, Summary Suggests

Some members of the Bank of Canada’s governing council are growing concerned that high interest rates may bring down inflation by more than necessary. The central bank’s summary of deliberations released Wednesday offers a glimpse into the council’s discussions in the lead-up to the Sept. 4 interest rate cut. Some members took the view that the risks were balanced, with strength in shelter and services price inflation offsetting the downward pressure from excess supply, the summary says. “Some had become more concerned with the downside risks to inflation, particularly if the economy and labour market weakened further.” The summary comes one day after Statistics Canada reported that inflation hit two percent last month, finally reaching the Bank of Canada’s target....