Bloomberg News

Flaherty Says Carney’s Replacement Needs to Control Inflation

December 23, 2012

Canadian Finance Minister Jim Flaherty said it’s important that the next governor of the Bank of Canada maintain “solid monetary policy” and control inflation.

“Inflation is very dangerous,” Flaherty said in an interview today with the CTV television network’s “Question Period” program. “The Americans are printing a lot of money, so are others around the world, so we have to watch that we never go back to the ’70s and ’80s where inflation got out of control in Canada.”

Governor Mark Carney, who has kept the key lending rate at 1 percent for more than two years, will leave the central bank June 1 to take the same job with the Bank of England. Flaherty has “a lot of respect” for Bank of Canada Senior Deputy Governor Tiff Macklem, a possible front-runner to succeed Carney, he said Dec. 5.

“Continuity matters,” Flaherty said. “But what really matters is to have a person who will maintain solid monetary policy and control inflation.”

Flaherty also said he doesn’t expect additional steps will be needed to cool the Canadian housing market in 2013.

To contact the reporter on this story: Liezel Hill in Toronto at lhill30@bloomberg.net

To contact the editor responsible for this story: Simon Casey at scasey4@bloomberg.net


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