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Canada needs to be ‘financially prudent’ in budget, says finance minister



© Reuters. Prime Minister Justin Trudeau and Canada’s Deputy Prime Minister and Minister of Finance Chrystia Freeland arrive for the next three-day federal cabinet meeting in Hamilton, Ontario, Canada January 23, 2023. REUTERS/Carlos Osorio

By Steve Scherer

OTTAWA (Reuters) – Canada’s Finance Minister Chrystia Freeland on Tuesday said her approach to this year’s budget, which is due out this spring, will be carefully calibrated due to the magnitude of the problem. high volatility in the global economy.

“There is still a lot of uncertainty in the world economy, and that means we need to continue to take a fiscally prudent approach,” Freeland said in response to a reporter’s question. This year’s budget member is streamed online.

“We still don’t know for sure how the plane will land. We don’t know for sure how the COVID recession will ultimately play out,” she said in Hamilton, Ontario on the sidelines of a meeting of cabinet ministers. .

Last fall, Freeland promised not to complicate the central bank’s job of controlling decades of high inflation when she presented the fall financial update, however, the update included 11, C$3 billion in new spending that some analysts say is too much.

Inflation remains at more than 6% – three times the central bank’s 2% target. The Bank of Canada will announce its latest interest rate decision on Wednesday, with analysts forecasting a quarter point increase and then a likely pause.

The government has said it is willing to increase the delivery of health services to the provinces this year and it wants to invest to help Canada be more competitive with the United States as it moves towards green technologies.

Canada has also committed to bolstering its military and continuing to provide arms and aid to Ukraine.

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