OTTAWA – The Canadian Labour Congress finds it disheartening that the Bank of Canada made the wrong decision when it left interest rates unchanged.
"Reducing the 1.75 percentage point interest rate differential between ourselves and the US would have helped bring the soaring loonie back to earth and thus saved jobs which will now be lost," states Ken Georgetti, president of the Canadian Labour Congress.
Georgetti also points out that in its very own statement the Bank of Canada provides all the legitimate reasons justifying a cut in interest rates. Not only is inflation checked, the Bank of Canada also tells us "there is uncertainty about the extent to which the appreciation of the Canadian dollar will offset the effects of stronger world demand for Canadian goods and services".
The Canadian Labour Congress has been telling the Bank of Canada for some time that manufacturing and export jobs are vulnerable because our dollar has gone up too far, too fast. "Many of our affiliated unions are already reporting many plant closures, and fear that more are on the way. We have already lost 102,000 manufacturing jobs since last November. With the latest figures showing that our economy is stumbling along at a 1% growth rate compared to 8% in the US, this was the wrong decision for Canadian workers," Georgetti explains.
"Moreover why should Canadians face higher rates than Americans when our economy is under-performing so badly compared to theirs?" Georgetti asked in conclusion.