Economics

Trudeau Budget Will Complicate Bank of Canada Inflation Fight

  • Freeland readies more spending amid aggressive rate hikes
  • Scotiabank sees C$40 billion more in red ink over five years
Chrystia Freeland speaks at a Dec. 13 news conference with Tiff Macklem announcing the renewal of the Bank of Canada’s inflation-targeting mandate.Photographer: David Kawai/Bloomberg
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Finance Minister Chrystia Freeland may effectively tell the Bank of Canada it’s on its own in tackling inflation when she introduces a budget Thursday that’s expected to be full of new spending initiatives.

In the lead-up to the release, Prime Minister Justin Trudeau’s government has indicated it remains more committed to delivering new social programs than repairing fiscal damage from the pandemic or cooling an overheated economy.