The Bank of Canada raised their policy rate 25 basis points yesterday to 2.5 percent, and as you might expect, the political reaction was bordering on unhinged. The Bank governor’s reasoning was pretty clear—global oil prices are pushing headline inflation up, and while core inflation is on target (meaning the measures that strip out the most volatile components), there is concern that businesses that are currently absorbing the increased fuel costs are going to start passing those costs on through the economy. The rate hike is more of a signal than anything—it can’t do anything about the Strait of Hormuz, but it can send a signal to the economy that the Bank isn’t going to take risings costs lying down, and they’re going to do their part to rein them in. That’s the thing about monetary policy—it’s as much about sending signals to the market and being willing to back them up with its levers than anything.
For the opposition parties, however, reading apparently isn’t their strong suit. The Conservatives insisted that this was all about the government’s “out of control” spending and deficits, and that’s what is fuelling inflation, all of which is absolute hokum. Tiff Macklem was quite clear in the statement that what’s driving the inflation are global factors, meaning oil prices. The NDP, however, insisted that “This is a clear result of the Liberal government’s failure to get inflation under control.” First of all, managing inflation is the Bank’s job, not the government’s. And second of all, core inflation is on target. Inflation is under control. The spike in the headline number is entirely gasoline prices, which we do not control. And then they took a gratuitous shot about Carney’s initial support for the war in Iran. The cherry on top is that the government is refusing to actually dispute any of the absolutely false things the opposition is saying, and are instead patting themselves on the back for the Bank’s growth projections, because that’ll combat disinformation!
The releases from the Conservatives and NDP are both written from fantasylands that didn't read anything the Bank wrote. The Bank said nothing about deficits or government spending. They did say the source of inflation was global oil prices. Both parties ignored those facts.
— Dale Smith (@journodale.bsky.social) 2026-10-28T20:26:21.043Z
I'm forced to conclude that either our opposition finance critics are illiterate, or they simply lie in order to fit their narratives—likely the latter. Meanwhile, the prime minister is a former central banker but didn't bother to cite the Bank's language in QP today.We are so absolutely boned.
— Dale Smith (@journodale.bsky.social) 2026-10-28T20:26:21.044Z
It is frankly distressing to see just how absolutely economically illiterate the “finance critics” of our opposition parties are. I know that you have narratives that you want to push, but you don’t have to lie to the public to try and make your point. You can be concerned about the size of the deficit without lying that it is driving inflation (when core inflation is on target!) and that it forced the interest rate hike. You can express concerns about the war in Iran pushing up prices without saying that the government didn’t get inflation under control (when again, core inflation is on target! FFS!) This should not be rocket science, and yet, here we are. We don’t have to keep making this the dumbest timeline. These kinds of statements are a choice.
My Latest:
My column explores the notion that the BC election is a sign that it’s time for “normie” conservatives to be in ascendance, and why that is not necessarily the case.
Ukraine Dispatch:
Here is a look at the propaganda Russia is orchestrating behind the “ceasefire” in Oleshky. That “ceasefire” effectively applies to Kherson, across the river, which is a respite for its residents. Russian drones struck a container ship off Bulgaria.
Noteworthy:
- Here is an interview with the director of CSIS about trying to change the culture of the organisation as they are in an HR crisis.
- Danielle Smith has staved off a leadership review for the time being.
- Kevin Carmichael parses the Bank of Canada’s rate decision.
U.S. Ambassador Pete Hoekstra Is Blaming Canada If Trump Loses The Midtermsyoutu.be/F7mS2GOyHcc
— Clare Blackwood (@clareblackwood.bsky.social) 2026-10-28T21:04:01.451Z
Want more Routine Proceedings? Become a patron and get exclusive new content.