Bank of Canada's Carolyn Rogers Says Housing Affordability Requires New Tools

Senior Deputy Governor Carolyn Rogers of the Bank of Canada says monetary policymakers are struggling to find new tools and pathways to address persistent housing affordability challenges.

Rogers pointed out that in the year 2000, residential investment accounted for 4.3% of Canada's gross domestic product, while business investment in equipment and machinery sat at 8.3%. These shares have now largely reversed.

The senior deputy governor said the central bank's key interest rate is 'too blunt' to fix housing affordability alone because lower rates fuel rising prices while higher borrowing costs box out prospective buyers.