Bank of Canada governor says new rules for Crown agencies won’t affect independence

OTTAWA – Bank of Canada governor Stephen Poloz is dismissing any suggestion that the central bank’s independence will be undermined by new government rules for Crown agencies.

In his first significant public appearance since taking over the job on Monday, Poloz told a Commons committee that there is a clean separation between the central bank’s role as a policy maker and its administration role.

The March budget called for government oversight on the hiring and remuneration of employees at Crown agencies, including the Bank of Canada.

Poloz says the Bank of Canada independence on monetary policy is enshrined in tradition and law.

He also says not see a problem meeting the new rules, saying the central bank has always considered itself a team player.

On the economy in general, Poloz says the world is undergoing an unusual post-recession recovery, something that’s akin to a post-war reconstruction.

Poloz says it is no surprise that the Canadian recovery is taking such a long time to take root, given the damage caused by the deep recession that had the impact of actually shrinking the country’s economic output.

For conditions to normalize, he says it is critical that foreign demand recover so that Canadian exports can strengthen and business confidence build.