Reuters GraphicsThe broadening of price increases, increased wage settlements, as well as rising consumer and business inflation expectations are signs that inflation is becoming more entrenched in the economy, economists told Reuters. That is an outcome that the Bank of Canada has hoped to avoid, saying it would require more aggressive interest rate hikes to bring inflation back under control. Economists at Desjardins Group and Oxford Economics also foresee aggressive rate hikes leading to a recession, though they cast it as a mild downturn. We need to cool the economy to get inflation back to target," Senior Deputy Governor Carolyn Rogers told reporters earlier this month. As for headline inflation, the central bank has it returning to 2% in 2024.

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