On Tuesday, Newfoundland and Labrador Premier Andrew Furey became the latest provincial leader to join the growing political chorus against another interest rate hike.
Furey’s office released a letter to Bank of Canada governor Tiff Macklem in which the premier called on the bank to “more fully consider the negative impacts” interest rate hikes are having on Canadians and to forgo another rate hike “at this time.” The bank is expected to announce its next rate decision on Wednesday.
Last week, B.C. Premier David Eby sent a letter to the governor urging a halt to rate hikes in the name of affordability.
This week, Ontario Premier Doug Ford sent a similar letter — and followed it up with some of the strongest language yet from any Canadian politician on rate hikes:
“[A] message to the Bank of Canada: Enough is enough. You’re trying to kill the economy. You personally are responsible for creating inflation,” Ford told a press conference Tuesday.
“Companies do not want to invest in new equipment because of the interest rates. A lot of people can’t afford to get a mortgage because they’re struggling. They’re going to be losing their homes. That’s on your shoulders.”
The politics behind the pressure
The political pressure is coming from premiers whose governments are leaning hard on affordability as a priority.
All three premiers come from different parties: B.C.’s New Democrats, Ontario’s Progressive Conservatives and Newfoundland and Labrador’s Liberals.
One former Bank of Canada governor says there’s politics at play.
It’s terrible because the impartiality, the independence, the non-partisanship of the central bank in Canada is extremely important and this is a reckless act that put that in jeopardy.– Ross Hickey, UBC Okanagan
“It’s a bit of … political grandstanding on the part of the premier[s],” said former BoC governor David Dodge when asked about the letters.
He said he doesn’t see a problem with that.
“There’s always a dialogue between the minister of finance and the governor of the bank, between public servants in (the federal Department of Finance) and staff at the bank,” he told CBC News.
“There’s always a dialogue going on. That’s how the system is actually supposed to work. Where the problem would come is if there were no dialogue.”
Dodge said the Bank of Canada is transparent with its process and explicitly outlines the factors behind each interest rate decision, which include taking into account the public’s best interests.
Former Bank of Canada governor David Dodge says the central bank is transparent about how it makes interest rate decisions. (Tom Hanson/Canadian Press)
“How I dealt with it, and how the current governor deals with it, is to try to explain to people — and to governments — why it is that the current interest rate level, or the current policy they are pursuing, is appropriate in order to stabilize the economy, both in terms of growth and in terms of price level,” he said.
Not everyone thinks the premiers’ attempts to influence the bank are harmless. Ross Hickey, an economist and associate professor at UBC Okanagan, called the letters “ridiculous.”
“It’s reckless because we don’t want our central bank to respond to politicians at all,” he told CBC News Friday after Eby’s letter was published.
“It’s terrible because the impartiality, the independence, the non-partisanship of the central bank in Canada is extremely important and this is a reckless act that put that in jeopardy.”
It’s a politicalexercise in those premiers taking the chance to sort of stand up for regular folks in their in their provinces.– Gerald Baier, UBC associate professor of political science
Hickey compared it to attempts to influence the Supreme Court of Canada and said the Bank of Canada must remain at arm’s-length from politicians.
If interest rates are held where they are, he said, it should be because the data suggests that is the prudent move right now.
“I hope that the Bank of Canada speaks to all Canadians and all politicians, and restates the importance of the independence of the central bank from politics,” he said.
Not harmful, not helpful
Some political experts don’t see publicly lobbying the Bank of Canada as harmful.
“I don’t see it as particularly negative,” said Gerald Baier, associate professor of political science at the University of British Columbia.
“Obviously, the Bank of Canada collects information, collects data that helps make its decisions. But it’s not hurting anyone for them to write a letter that says, ‘Here’s what’s going on and here are the negative effects of of continued interest rate hikes.'”
Baier also suggested the premiers’ actions are mostly about political optics and the only ones they’re helping are themselves.
Three premiers urge Bank of Canada to halt interest rate hikes
Desjardin chief economist Jimmy Jean and Centre for Future Work director and economist Jim Stanford look ahead to tomorrow’s central bank rate announcement after premiers Eby, Ford and Furey called for a pause.
“It’s a political exercise in those premiers taking the chance to sort of stand up for regular folks in their in their provinces,” said Baier.
“A lot of the audience is not the Bank of Canada but voters who would look at their premiers and say, ‘You gotta be doing something more to influence this policy.'”
The NDP’s Jagmeet Singh was the first federal leader to wade into the debate this week.
“The Bank of Canada’s approach is not working — in fact, it’s creating more pain for people,” Singh told a recent news conference in B.C.
“Grocery prices are extremely high and the cost of housing remains really high. How has the Bank of Canada made people’s lives better? By taking on inflation when grocery prices continue to rise and housing is still completely unattainable for people.”
TORONTO – Canada Goose Holdings Inc. says it has signed a deal that will result in the creation of its first eyewear collection.
The deal announced on Thursday by the Toronto-based luxury apparel company comes in the form of an exclusive, long-term global licensing agreement with Marchon Eyewear Inc.
The terms and value of the agreement were not disclosed, but Marchon produces eyewear for brands including Lacoste, Nike, Calvin Klein, Ferragamo, Longchamp and Zeiss.
Marchon plans to roll out both sunglasses and optical wear under the Canada Goose name next spring, starting in North America.
Canada Goose says the eyewear will be sold through optical retailers, department stores, Canada Goose shops and its website.
Canada Goose CEO Dani Reiss told The Canadian Press in August that he envisioned his company eventually expanding into eyewear and luggage.
This report by The Canadian Press was first published Sept. 19, 2024.
Almost seven years since news broke of an alleged conspiracy to fix the price of packaged bread across Canada, the saga isn’t over: the Competition Bureau continues to investigate the companies that may have been involved, and two class-action lawsuits continue to work their way through the courts.
Here’s a timeline of key events in the bread price-fixing case.
Oct. 31, 2017: The Competition Bureau says it’s investigating allegations of bread price-fixing and that it was granted search warrants in the case. Several grocers confirm they are co-operating in the probe.
Dec. 19, 2017: Loblaw and George Weston say they participated in an “industry-wide price-fixing arrangement” to raise the price of packaged bread. The companies say they have been co-operating in the Competition Bureau’s investigation since March 2015, when they self-reported to the bureau upon discovering anti-competitive behaviour, and are receiving immunity from prosecution. They announce they are offering $25 gift cards to customers amid the ongoing investigation into alleged bread price-fixing.
Jan. 31, 2018: In court documents, the Competition Bureau says at least $1.50 was added to the price of a loaf of bread between about 2001 and 2016.
Dec. 20, 2019: A class-action lawsuit in a Quebec court against multiple grocers and food companies is certified against a number of companies allegedly involved in bread price-fixing, including Loblaw, George Weston, Metro, Sobeys, Walmart Canada, Canada Bread and Giant Tiger (which have all denied involvement, except for Loblaw and George Weston, which later settled with the plaintiffs).
Dec. 31, 2021: A class-action lawsuit in an Ontario court covering all Canadian residents except those in Quebec who bought packaged bread from a company named in the suit is certified against roughly the same group of companies.
June 21, 2023: Bakery giant Canada Bread Co. is fined $50 million after pleading guilty to four counts of price-fixing under the Competition Act as part of the Competition Bureau’s ongoing investigation.
Oct. 25 2023: Canada Bread files a statement of defence in the Ontario class action denying participating in the alleged conspiracy and saying any anti-competitive behaviour it participated in was at the direction and to the benefit of its then-majority owner Maple Leaf Foods, which is not a defendant in the case (neither is its current owner Grupo Bimbo). Maple Leaf calls Canada Bread’s accusations “baseless.”
Dec. 20, 2023: Metro files new documents in the Ontario class action accusing Loblaw and its parent company George Weston of conspiring to implicate it in the alleged scheme, denying involvement. Sobeys has made a similar claim. The two companies deny the allegations.
July 25, 2024: Loblaw and George Weston say they agreed to pay a combined $500 million to settle both the Ontario and Quebec class-action lawsuits. Loblaw’s share of the settlement includes a $96-million credit for the gift cards it gave out years earlier.
Sept. 12, 2024: Canada Bread files new documents in Ontario court as part of the class action, claiming Maple Leaf used it as a “shield” to avoid liability in the alleged scheme. Maple Leaf was a majority shareholder of Canada Bread until 2014, and the company claims it’s liable for any price-fixing activity. Maple Leaf refutes the claims.
This report by The Canadian Press was first published Sept. 19, 2024.
Companies in this story: (TSX:L, TSX:MFI, TSX:MRU, TSX:EMP.A, TSX:WN)
TORONTO – TD Bank Group, which is mired in a money laundering scandal in the U.S., says chief executive Bharat Masrani will retire next year.
Masrani, who will retire officially on April 10, 2025, says the bank’s, “anti-money laundering challenges,” took place on his watch and he takes full responsibility.
The bank named Raymond Chun, TD’s group head, Canadian personal banking, as his successor.
As part of a transition plan, Chun will become chief operating officer on Nov. 1 before taking over the top job when Masrani steps down at the bank’s annual meeting next year.
TD also announced that Riaz Ahmed, group head, wholesale banking and president and CEO of TD Securities, will retire at the end of January 2025.
TD has taken billions in charges related to ongoing U.S. investigations into the failure of its anti-money laundering program.
This report by The Canadian Press was first published Sept. 19, 2024.
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