The governor of the Bank of Canada has warned that prices will continue to rise

Annual inflation rates have crossed the Bank of Canada’s comfort zone since April, reaching 4.1% in August. The central bank expects rates to exceed its 2% target for the rest of the year.

Governor Tiffany Maclem said barriers to the flow of goods and oil internationally were not diminishing as quickly as he and his colleagues around the world had hoped.

However, he believes that this problem can only lead to an increase in prices instead of sustained inflation.

What has happened worldwide is that there has been a sharp rebound in consumer spending, especially as demand for goods to be shipped through supply chains has fallen sharply. Last year, and through the pandemic and ongoing public health measures.

All of these affect stocks of consumer products in demand and the distribution of parts needed to build goods such as cars and pass on shipping costs to consumers.

At the same time, shipping delays mean that homes are not getting the goods they need quickly enough, which means their cost is delayed, slowing growth.

We still hope for a good rebound. It may not be as fast as we expected In a July reference, Tiff McClellan said in a video conference with reporters Thursday night.

What we have seen since then are these supply barriers. Then they were definitely a factor, but they became more complicated.

Reducing supply chain limitations

U.S. President Joe Biden on Wednesday announced plans to run the Los Angeles harbor around the clock, easing pressure on commodity prices as companies focus on higher costs. Joe Biden called on companies to do more for themselves.

Finance Minister Christiana Freeland said the government was aware of supply chain problems in the Canadian economy and was looking for signs of pressure at Canadian ports. Speaking to reporters on Thursday afternoon, Minister Freeland also said Canadians should have confidence in the country’s economic recovery, but noted some headwinds.

Economic recovery will inevitably be uneven both in Canada and in the world, and this natural disparity will intensify with the fourth wave of coronavirus., She told the Canadian embassy in the US capital.

We need to be realistic about it, we need to know about it. But I think we can also have a very confident view of Canada’s economic resilience and the strength of our recovery.

Supply chain issues were raised during meetings this week in Washington with Christiana Freeland’s global counterparts, as well as Hong Nam-ki of South Korea and Janet Yellen of the United States.

Counter the politics of American Buy

There were also warnings that Canada would respond to any new policy provisions during Minister Freeland’s meeting with Janet Yellen. American Buy Under Biden Administration’s financial assistance program, Canadian companies limit their ability to compete for US government contracts.

What Canada is telling our partners is that just as your sourcing opportunities are open to our businesses, so are our sourcing opportunities open to your businesses.

The Canadian Chamber of Commerce on Thursday asked the government to push back any new regulations American Buy, Which has been a thorn in the side of relations since spring.

In a briefing before a phone call with Janet Yellen on April 7, Finance Ministry officials told Minister Freeland Canadian suppliers may have access to areas where the United States has international commitments By the World Trade Organization.

The memo, obtained under the Freedom of Information Act by the Canadian Press, adheres to the policy American Buy Supply chain tensions were observed during the epidemic. She argues that Canada is a reliable supplier to the United States and that the two countries must do so, officials told Minister Freeland. Further strengthen our mutually beneficial cross-border supply chains.