World Economy

Canada Central Bank Says Housing Market Won't Drive Rate Policy

The Bank of Canada's deputy governor said the central bank cannot use interest rates to manage home prices. Housing will be positioned as a consideration rather than a policy target. The stance reflects broader challenges facing monetary authorities across North America and beyond, where inflation control remains the primary mandate despite its impact on real estate markets. Central banks in the U.S. and U.K. have similarly indicated they lack effective levers to directly address housing affordability through rate decisions. Peru's persistent inflation, which accelerated to a three-year high in recent months, underscores ongoing pressures that keep policymakers focused on taming price growth. Financial conditions remain insufficiently tight in several economies, according to rate-setters. This suggests further policy action may be necessary despite uncertain outcomes for asset prices.