Poloz preaches stability, patience

In his first speech as Bank of Canada governor, Stephen Poloz presented himself as a man attuned to the “main street” of corporate Canada, stressing the importance of restoring business confidence in the country and not hounding firms about being thrifty.

Speaking in Burlington, Ont. — one of the country’s major manufacturing centres that has been ravaged by recession — Poloz on Wednesday advocated “patience” as Canadian businesses continue to be cautious with their balance sheets, even as he revealed no new major policy initiatives.

The approach is a notable shift from that of his predecessor, Mark Carney, who criticized Canadian companies for sitting on near-record piles of cash.

“Companies that I talk to are feeling comfortable, are watching their orders, they’re watching their foreign customers, they’re getting into new markets, so they are growing, but they’re being understandably cautious, given what they’ve been through,” he said after a speech to the Oakville Chamber of Commerce.

Poloz offered optimism that the macroeconomic outlook was improving. He said stabilization in Europe, a continuing recovery in the United States and new monetary growth measures in Japan were creating green shoots that may embolden Canadian firms to soon start spending again.

“This sequence may already be under way,” he said, referring to increased business spending, pointing out that the data tend to lag actual changes. “Right now, what we need most is stability and patience.”