A short-term solution to inflation may not be easy, but Concordia University economist Moshe Lander is convinced that the end is coming.
"The best thing we can do at this point is to just sit down and deal with it and find a way to overcome it, as bad as it sounds bad." He says. He told CTV Your Morning on Thursday.
"If you can overcome COVID, you can overcome a rough one-year inflation patch."
May's annual inflation rateis almost 40 years. It has risen to the highest level. Statistics Canada reports an increase of 7.7% compared to a year ago.
Energy prices rose 34.8% year-on-year, and gasoline prices at that time rose 48%. Excluding gasoline, annual inflation in May rose from 5.8% in April to 6.3%.
The Bank of Canada has tripled its key interest rate target to 1.5% so far this year to curb inflation.
Government spending
This news is in the midst of a report from Scotiabank on Sunday advocating reducing government spending to reduce inflation.
"It is no exaggeration to say that Canada's fiscal policymakers have no importance at this point in delaying inflation," the report said. ..
Lander said reducing government spending is the right policy, but its position is equivalent to "political suicide."
"People don't hear it's the right solution," he said. "Now I think people want money in their pockets to help the government rise in gasoline prices, rent and housing costs, so that's also the right thing to do. Nonetheless, the idea of taking the opposite policy would be really politically unpopular. "
Economists and others are temporarily exempt from collecting gasoline taxes on rising gasoline prices. It is required to be used bysome Canadian and American states.
"It won't have much of an impact on inflation," Lander argues.
"It's a great visual for Canadian consumers, but it doesn't work very well. The problem is that it's inconsistent with the government's policy on the environment, so I'm not sure if it's accurate. A solution trying to solve the inflation problem. "
A senior researcher at the Macdonald-Laurier Institute told CTVNews.ca in March, politically good, but a temporary suspension of the gasoline taxsaid it promoted consumption, leading to opposition to the destruction of demand. Or if the price of a product is so high that it literally kills the demand for that product.
Use CTV News and The Canadian Press files
