WatchCanadians should get used to idea of 3 interest rates says Bank

Poloz says the current rate is still too stimulative for the improved economy and he’s reiterating his warning that it will rise to what the bank considers its neutral range of between 2.5 and 3.5 per cent.He says the pace of future rate increases is still unknown, but he adds the bank will carefully analyze how well the hikes are absorbed — particularly for the many households that have piled on considerable debt in the low-rate environment.“We sought to put more emphasis on the notion that someday we’re going to be back at neutral — and that neutral is 2.5 to 3.5 per cent — so that people would begin to digest that as an approaching fact,” Poloz told the House of Commons finance committee.“It shouldn’t be a hard thing for people to service their debt at those kinds of interest rates. But if people have overextended themselves, given the low interest rates, then we’ve got a transition issue. That’s why we’re putting so much emphasis on that and analyzing it so carefully, and choosing our pace as we gather the data.” OTTAWA — Bank of Canada governor Stephen Poloz wants Canadians to get used to the idea of three per cent interest rates as the new normal, now that the era of rock-bottom borrowing costs is gradually fading away.Poloz raised the benchmark rate last week for the fifth time in just over a year to 1.75 per cent — its highest level in about a decade.He sent signals that future hikes could arrive sooner than previously expected, in large part due to the economy’s resilience and the removal of some business uncertainty following the recent agreement on an updated North American trade pact.Stephen Poloz’s dashboard: The charts that matter most to the Bank of CanadaRosenberg: Things aren’t nearly as rosy as the Bank of Canada believesCanada’s household debt flashes red in Morgan Stanley risk reportTestifying before MPs on Tuesday in Ottawa, Poloz said many adults are used to the lower rates and are too young to remember the much-higher rates of the 1980s, when they climbed into the teens.Bank of Canada Governor Stephen Poloz and Senior Deputy Governor Carolyn Wilkins arrive to appear as witnesses at the House of Commons Standing Committee on Finance, Tuesday. Canadian Press/Adrian Wyld read more

New York train crash driver may have nodded off

first_imgTHE DRIVER OF a train that derailed in New York at the weekend, killing four people, experienced a “daze” right before the train derailed.William Rockefeller was interviewed by the National Transportation Safety Board investigators yesterday and admitted that he may have nodded off at the controls before attempting to hit the brakes.His attorney Jeffrey Chartier told reports outside the interview that Rockefeller had experienced a lapse in concentration similar to that of road fatigue, but couldn’t say how long it lasted.He said Rockefeller remembers “operating the train, coming to a section where the track was still clear — then, all of a sudden, feeling something was wrong and hitting the brakes. He felt something was not right, and he hit the brakes.”He called Rockefeller “a guy with a stellar record who, I believe, did nothing wrong.”“You’ve got a good guy and an accident,” he said. “A terrible accident is what it is.”Rockefeller “basically nodded,” said Anthony Bottalico, leader of the rail employees union, relating what he said the engineer told him.Investigators say it is too soon to say if human error played a part in the crash, but questions about Rockefeller’s role mounted as it was revealed the train had been travelling above the speed limit.Additional reporting by Associated PressPics: Four dead, 63 injured as passenger train derails in New York CityRead: Probe launched into cause of New York train derailmentlast_img read more