We can expect to see some key numbers coming out tomorrow (Tuesday) on inflation for the month of December in Canada.
J.P. Gervais, the Chief Economist for Farm Credit Canada says the hope is that it will be coming down, and may start to plateau the cycle of higher interest rates.
"We have a big, big, critical data release tomorrow on inflation for the month of December in Canada. The hope is that this will be coming down slightly, because then that's one critical data point that would actually start, perhaps to plateau the cycle of higher interest rates."
There's been a lot of discussion around the idea of a recession.
Gervais says he doesn't spend too much time thinking about if we'll see a recession, adding that if we do, it will be different than before.
"Inflation is so high that the bank (Bank of Canada) will want to avoid any type of letting go too soon in terms of interest rates. Even if the economy slips and falls a little bit, then I do think that interest rates will plateau."
He feels we'll be riding the current wave of where interest rates are for most of 2023.
"We have no control over what will be going on in futures markets with regards to commodity prices. I mean, getting informed to make the right decisions is actually very valuable, but the things that we do control are right on the farm. So let's just spend some time not just out in the field, but inside as well to sharpen our pencils and say, hey there any efficiencies that I can actually get from the field
Overall, Gervais expects one more small interest rate increase from the Bank of Canada this month.
To hear more of Glenda-Lee's discussion on interest rates with J.P. Gervais click on the link below.