Some studies, in fact, claim that market-based sources could be more reliable as investors “have more skin in the game”.11 Since the early 1970s, especially since what is known as the “rational expectations revolution”, many studies have attempted to provide causal evidence on the extent to which expectations, specifically towards inflation, affect agents’ economic decisions.
But once we get through this slowdown, growth will pick up, our economy will grow solidly, and the benefits of low and predictable inflation will be restored. Finally, we are trying to balance the risks of under- and over-tightening. If we don't do enough, Canadians will continue to endure the hardship of high inflation.