The World Forum - July 20th, 2024

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Referencing 'In an emergency, break glass' signs, Bank of Canada official says, 'It's time to break the glass'


A senior Bank of Canada official says the need to improve productivity has reached an emergency level as the economy faces a future where inflation(opens in a new tab) may be more of a threat than in the past few decades.

“You know those signs that say 'In an emergency, break the glass?' Well, it's time to break the glass,” Bank of Canada senior deputy governor Carolyn Rogers said in a speech Tuesday.

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Rogers said Canadian labour productivity eked out a small gain at the end of last year, but that came after six straight quarters where productivity fell.

She noted the U.S. has seen productivity gains coming out of the pandemic as firms found their footing, but Canada has not seen the same.

The need to improve productivity comes as Rogers said many of the forces that helped create a benign environment for inflation in the past are going to fade away, or even reverse.

The Bank of Canada's next interest rate decision and monetary policy report is set for April 10.