Central bank independence key in times of global volatility-Canada finance minister

BY Reuters | ECONOMIC | 05/20/22 09:43 AM EDT

OTTAWA, May 20 (Reuters) - Canada's finance minister Chrystia Freeland said on Friday it is important in periods of global volatility to express confidence in the central bank and a clear commitment to its independence from political interference.

"It is clear to us all that we are living through a period of global volatility. We have COVID. We have the Russian invasion of Ukraine. We have China's zero-COVID policy," Freeland told reporters after G7 talks in Munich, Germany.

"In this environment, responsible political leadership means reinforcing for Canadians, and for the world, our government's very clear commitment to the independence of the Bank of Canada and our confidence in the Bank of Canada." (Reporting by Julie Gordon and Steve Scherer in Ottawa; Editing by Chizu Nomiyama)

In general the bond market is volatile, and fixed income securities carry interest rate risk. (As interest rates rise, bond prices usually fall, and vice versa. This effect is usually more pronounced for longer-term securities.) Fixed income securities also carry inflation risk and credit and default risks for both issuers and counterparties. Unlike individual bonds, most bond funds do not have a maturity date, so avoiding losses caused by price volatility by holding them until maturity is not possible.

Lower-quality debt securities generally offer higher yields, but also involve greater risk of default or price changes due to potential changes in the credit quality of the issuer. Any fixed income security sold or redeemed prior to maturity may be subject to loss.

Before investing, consider the funds' investment objectives, risks, charges, and expenses. Contact Fidelity for a prospectus or, if available, a summary prospectus containing this information. Read it carefully.

fir_news_article