OTTAWA, (Reuters) – Canada requires higher interest rates. But, how much will they go depends on how the economy reacts and the outlook for inflation, Bank of Canada Governor Tiff Maklem stated on Wednesday.

Macklem said that “the economy needs higher rates” and added, “The economy can handle them,” he told the Senate committee. This was a repeat of recent statements. The economy’s response and the inflation outlook will dictate how high rates rise.