Author: Canada Vancouver Sailing Farm – Maple news Talk
(Picture source CTV news)

According to CTV News reported on May 12, Bank of Canada deputy governor Toni Gravelle said on the same day that factors such as a strong economic recovery, supply chain disruptions and the Russian-Ukrainian war have jointly promoted the highest inflation in history.

Although inflation is now at its highest level in decades, it is different from the 1970s, when high inflation was accompanied by high unemployment and recessionary economic growth.  Gravell pointed out that the unemployment rate is not what it used to be, and the current unemployment rate is about 5%, while the average unemployment rate between 1976 and 1982 was about 8%.

In addition, another difference from the economic crisis of the 1970s is that the Bank of Canada reached an agreement with the federal government to control inflation targeting and adopted monetary policy to keep inflation and future inflation expectations low.  As a result, the central bank raised its key interest rate to 1% last month in a bid to help slow inflation and expects to continue raising rates.

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