OTTAWA, Nov. 22 (Xinhua) -- Bank of Canada Governor Tiff Macklem said on Wednesday that the excess demand in the country's economy that made it too easy to raise prices "is now gone."

Outlining how monetary policy is working to bring the inflation down, Macklem said interest rates may now be restrictive enough to get Canadians back to price stability.

The central bank responded forcefully to high inflation and raised the policy rate from close to zero in early 2022 to its current level of 5 percent. As a result, the Canadian economy is slowing with growth in gross domestic product near zero over the past several months, Macklem said in remarks at the Saint John Region Chamber of Commerce, New Brunswick.

"The economy is approaching balance," Macklem said, adding that "we expect the economy to remain weak for the next few quarters, which means more downward pressure on inflation is in the pipeline."

Macklem reiterated his efforts to fight to get back to low inflation. "If high inflation persists, we are prepared to raise our policy rate further," he said.

"To return to low inflation and stable growth in the years ahead, we need these higher interest rates and slow growth in the short term," the governor concluded.

Statistics Canada reported Tuesday that the country's inflation rate slowed to 3.1 percent in October, down from 3.8 percent in September and 8.1 percent in June 2022, bringing it closer to the Bank of Canada's target of 2 percent. Enditem

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