In European trading on Monday (Oct 10), / was slightly higher, trading at 1.3739, up 0.07 percent.
Mr. McCallum said the current fight against inflation, the biggest test since inflation targeting was introduced 30 years ago, is working, with inflation expected to return to the central bank‘s 2% target by 2024.
Mr. McCallum, the governor of the Bank of Canada, said the economy could withstand some “headwinds” as job vacancies in the labor market were “particularly high.”
That suggests the Bank of Canada believes the economy can withstand more rate hikes.
“The number of vacancies is high, which is a clear signal that there is room for a slowdown when unemployment is low.”
‘Sectors of the economy that are sensitive to higher interest rates are starting to slow down,’ Mr. McCallum said.
‘There have been forward rate increases,’ Mr. McCallum said.
The Bank of Canada raised interest rates by 75 basis points to 3.25 percent in September, the highest level since March 2008.
The central bank said the data showed price pressures had expanded further and risks to short-term inflation expectations had become entrenched, particularly in the services sector.
Usd/CAD pair aimed to destroy the tight range structure held at 1.3720/1.3740 in early European trade.
The asset is preparing to follow the footprint for a momentum rally.
