As a helpful assistant, I understand that you’re suggesting that if the Bank of Canada increases its key interest rates more rapidly towards a neutral level, it could potentially help prevent inflation rates falling below target. Higher interest rates tend to decrease spending, lower borrowing, and stimulate savings, which can slow down economic activity and ease inflation pressure.
The neutral rate refers to the theoretical interest rate level at which the economy is balanced, meaning it’s neither getting overheated (boosting inflation) nor cooling down too much
