Ontario Premier Doug Ford took a page from BC Premier David Eby’s book this weekend by writing a letter to Bank of Canada Governor Tiff Macklem and urging him to “not raise interest rates any further.”
Ford’s letter comes just days before the BoC’s next interest rate decision, which is slated for Wednesday, September 6, and has experts speculating on whether the bank will opt to hike or hold given the conflicting trajectories of economic indicators like inflation and GDP.
“Over the last 18 months, we’ve suffered 10 interest rate hikes, which have had a devastating impact on people who are already struggling to get by,” wrote Ford on Sunday.
“These hikes have forced many families to pay thousands of dollars more per month just to cover their mortgage payments. Some are seeing payments double or triple. Your rate hikes have made it next to impossible for young people, newcomers, and first-time homebuyers to have any place to call home.”
Ford pointed to Statistics Canada’s latest inflation reading, which was bumped up by mortgage costs in July.
“Inflation on mortgage costs for Ontario families is now at 30%. Worse yet, Canada’s major banks expect a spike in default on loans and mortgages directly resulting from these recent hikes,” he said. “People all across our province tell me they have to choose between paying their mortgage and putting food on their family’s table. Ontarians simply cannot cope with the higher monthly payments on their homes brought about by repeated interest rate hikes.”
In lieu of “painful interest rate hikes,” Ford then implored the federal government to work with provinces and territories to “invest and build out the critical infrastructure projects,” pointing to Highway 413, the Bradford Bypass, and the Ontario Line subway as examples of projects that stand to “support economic growth and help get goods to market sooner to help keep costs down for people and businesses.”
The Ontario Premier also called on the feds to do their part in simplifying the regulatory processes for such projects, “with deference given to Ontario’s world-class environmental assessment processes so that we can get shovels in the ground and relieve inflationary pressures sooner.”
"I urge you to consider the effect higher interest rates are having on everyday people who are simply trying to make ends meet,” concluded Ford. “This is why I join Premier Eby in his call for the Bank of Canada not to raise interest rates any further. Instead, we hope the federal government will work with all premiers to build Canada for Canadians who are counting on us to make life easier and more affordable, now and for the future.”