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Rush of Immigrants to Slow Bank of Canada Rate Hikes, CIBC Says

Travelers walk through Pearson airport in Toronto last month. Canada welcomed more than 400,000 immigrants in 2021. — Travelers walk through Pearson airport in Toronto last month. Canada welcomed more than 400,000 immigrants in 2021.
Photographer: Cole Burston/Bloomberg

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January 20, 2022, 3:14 PM UTC

High immigration rates will allow the Bank of Canada to raise interest rates at a more moderate pace than markets expect, according to the Canadian Imperial Bank of Commerce.

The increased flow of newcomers and their suitability for the needs of the job market “will work to provide the Bank of Canada with some flexibility in the pace of monetary tightening due to the taming impact of new immigrants on wage inflation,” Benjamin Tal, deputy chief economist at CIBC, said Thursday in a report to investors.