HR: Bank of Canada governor talks low oil prices in Calgary
“It’s true that an abundance of raw materials may complicate the management of companies and complicate the conduct of economic policy”, Poloz said in the speech delivered in a province where, he noted, resources make up more than a quarter of economy.
Bank of Canada Governor Stephen Poloz said the fall in the nation’s dollar is helping to ease the damage from the shock of lower crude oil prices.
Energy advanced 1.66 percent, following a rally in oil prices on Monday, with the light, sweet crude for October delivery up 2 US dollars to settle at 46.68 USA dollars a barrel on the New York Mercantile Exchange. “The main reason is that supply rose sharply, thanks primarily to technological advances in oil extraction everywhere”, he said. “Without those investments, we would never have been able to capitalize on those higher prices, which boosted Canada’s aggregate income”. “We will continue to do so”.
“You gotta believe it’s better to have some of this stuff than not to have that stuff”, Poloz said of commodities in response to a question from the audience at the event hosted by Calgary Economic Development, a non-profit group that promotes growth in the city.
“Canada fell into a mild technical recession in the first half of the year, as low oil prices dragged down investment, and a swing in inventories overwhelmed an otherwise healthy economy”, TD said.
“We’ve adjusted to rising prices; we can adjust to falling ones”, Governor Poloz said.
“Growth is sufficient to offset past output losses by 2017, at which point the Bank of Canada will begin raising interest rates”, TD said in its Monday outlook. They are often hard and painful for affected individuals and their families.
“Further, allowing the currency to float frees the Bank of Canada to concentrate our single policy tool on our single target, which is inflation”.
Poloz adds it’s not just oil which can fluctuate at such a dramatic point, stating the price of copper, which has tripled, as well as the price of nickel, which doubled in a two year span in the late 2000′s.
