Indeed, the further increases in the prices of energy and other commodities in recent weeks, together with the latest data on consumer prices, suggest slightly greater upside risks to the projections of both overall and core inflation than we saw last month. Should high rates of overall inflation persist, the possibility also exists that inflation expectations could become less well anchored.
It is important for you to understand that when there are global shocks Canada always gets hits twice—once by the shock itself, and a second time by the associated decline in commodity prices. In other words, even if we had experienced zero cases of COVID-19, we would still have the macroeconomic effects of lower oil prices to contend with.