The Bank of Canada is looking for clear evidence of “further and sustained downward momentum in core inflation” before it considers cutting interest rates. That was the message governor Tiff Macklem addressed directly to markets in a press availability after his annual year-end speech on Dec. 15. …But when pushed explicitly by reporters on the fact that mortgage costs (which directly reflect the central bank’s base rate setting) are the main factor keeping inflation up, the governor emphasized that core inflation (including shelter) is the target of the Bank of Canada. …From our perspective, it is borderline outrageous that the Bank of Canada would be so consumed with inflation that it is largely responsible for: strip out the mortgage costs from the consumer price index and the inflation rate is pretty much at target.