The positive overall figures despite the slight July uptick means that the Bank could likely hit pause on rate increases next month without a significant negative impact, Gosselin said.
“As far as I’m concerned, I think the strategy of the Bank is working. I think we’re seeing inflation go down. I think mortgage prices are one of the most inflationary indicators that we’re seeing, and the rates increased super-fast from March to December.
“And so we’re seeing the impact of this crazy 4% hike between March and December of 2022 – so now as we move towards January, which means we remove this 4% from our yearly analysis, just naturally by virtue of how inflation is calculated, I think we’ll see it go down.”
A further rate increase next month is by no means a surefire thing, although Gosselin added that the central bank will undoubtedly be keeping its options open.
“I would advise the Bank not to raise interest rates. We know that it takes 12 to 18 months to have its full effect on the economy, and we haven’t even fully integrated the hike from last fall,” he said. “‘Give us a break,’ basically, is my message – but again, they might do so [hike] to send a message.