Did the Bank of Canada print money to finance the feds? Central bank sets record straight

As the Bank of Canada tries to reign in red hot inflation, the central bank is engaging in another fight: one against misinformation.

In recent weeks, the central bank has been using social media to engage the public on the economy, explaining how inflation works and what it’s doing to bring inflation back to its two per cent target. However, in its most recent Twitter thread, the bank went beyond explaining economics and took direct aim at a common attack levied against its policy decisions during the pandemic.

“#YouAskedUs if we printed cash to finance the federal gov’t. We didn’t,” the Bank of Canada tweeted on Aug. 25, followed by a series of tweets refuting the claim.

While central bank officials normally hold speeches and other events to communicate their thinking and to set expectations, Laval University economics professor Stephen Gordon says its audience has traditionally been smaller than it is today.

“The only people who pay attention are insiders and market experts. And that’s usually the only people that they have to talk to,” Gordon said.

Today’s high inflation environment and the politicization of the central bank has led to a wider audience, with more Canadians concerned about rising interest rates and the high cost of living. Alongside this heightened interest has also come a level of distrust of the Bank of Canada’s operations and a misperception that it printed money during the pandemic.

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