Ottawa to Appoint New Bank of Canada Director Friday

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Finance Minister Bill Morneau is about to announce the next Governor of the Bank of Canada, changing the leadership of the country’s central bank as it navigates the uncertainty of a pandemic recession .

Multiple sources confirm that the announcement will be made Friday morning when Justin Trudeau’s Liberal government is ready to announce the successor to Stephen Poloz, whose term as governor ends in June.

Bloomberg announced the impending announcement for the first time.

Two names appeared as the candidates most likely to replace Poloz. Tiff Macklen is a former chief deputy governor of the Bank of Canada and current dean of the Rotman School of Management. And Carolyn Wilkins is the current senior deputy governor of the bank.

Carolyn Wilkins is Senior Deputy Governor of the Bank of Canada. (Sean Kilpatrick / The Canadian Press)

Wilkins is the first woman to hold the office of Deputy Chief Governor and is said to be the first woman to hold the office of Governor.

The transition comes after millions of Canadians have signed up for government assistance and businesses – big and small – rely on wage subsidies supported by the federal government to survive.

Over the past few months, Poloz and Morneau have participated in several joint press conferences to demonstrate a coordinated approach to monetary and fiscal policy to deal with the economic fallout from the pandemic and the global oil shock.

Morneau announced more than $ 250 billion in direct financial assistance, credit support and tax deferrals to help offset the impact of the COVID-19 pandemic.

Tiff Macklen, left, is a former deputy chief governor of the Bank of Canada and current dean of the Rotman School of Management

Poloz lowered interest rates to a record low of 0.25%, urged the central bank to buy billions of government bonds every week until the economy recovers, and has taken action to strengthen liquidity in the banking sector.

The person replacing Poloz will face an economy which, according to the Bank’s own projections, could fall by 30% or more in the second quarter.

The next government will have practically no leeway to use interest rate cuts to help the economy. Poloz has already taken an unprecedented step – in Canada – in the direct purchase of government bonds.

This limited flexibility is compounded by the rapid use of the federal government’s fiscal power to put a financial floor under Canadian homes and businesses.

Parliamentary Budget Officer says federal deficit for the year is likely to reach $ 252 billion as a result of the COVID-19 pandemic, and could go even higher if emergency measures stay in place longer than expected.

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