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Raneem, 10, lives with a neurological condition and liver disease and needs Cholbam, a medication, for a longer and healthier life.
The Bank of Canada is expected to conclude a historic year marked by high inflation and aggressive monetary policy tightening with one more interest rate hike on Wednesday.
Forecasters anticipate the central bank will raise its key interest rate, which is currently at 3.75 per cent, by either a quarter or half a percentage point next week.
Even the smaller hike would bring the interest rate to the highest it's been since 2008.
In the wake of rapidly rising inflation this year, the Bank of Canada has raised its key interest rate six consecutive times since March, racing to clamp down on inflation expectations before they became unmoored.
After raising its key rate by a historic full percentage point in July, the Bank of Canada has tapered the size of its rate hikes. In September, it announced a three-quarter percentage point rate hike, followed by half a percentage point in October.
Now, the end of the rate hike cycle appears to be near.
Bank of Canada governor Tiff Macklem said as much following the last rate decision in October.
"We are getting closer to the end of this tightening phase but we're not there yet," Macklem said in a news conference on Oct. 26.
TD chief economist Beata Caranci said the Bank of Canada's recent language on the risks around rising interest rates suggests the bank is beginning to consider what the effects of the aggressive rate hikes will be.
In a speech on Nov. 22, Bank of Canada senior deputy governor Carolyn Rogers warned recent homeowners with variable-rate mortgages would likely find the adjustment to higher interest rates painful.
Rogers cited new research from the central bank that found half of variable-rate mortgages have now hit the "trigger rate," whereby mortgage holders' monthly payments only cover interest charges.
"That's the biggest signal I take away that they're nearing the endpoint of their rate hike cycle," Caranci said.
Laval University economics professor Stephen Gordon said the research on mortgages indicates the central bank may want to pause rate hikes soon to see the effects of higher rates play out in the economy.
"Everybody knows that it takes some time for these interest rate increases to take effect," Gordon said.
Economists generally say interest rate hikes can take one to two years to be fully felt in the economy.
Former Bank of Canada governor Stephen Poloz recently warned the aggressive rate hikes will likely have a stronger effect on the economy than many anticipate.
Speaking at a conference in Ottawa hosted by Western University's Ivey Business School, the former governor said today's economy is more sensitive to interest rates than it was 10 years ago because of high debt levels.
"Does anybody here think the sensitivity of the economy to interest rate movements is less today than it was five or 10 years ago?" Poloz asked. "I think (it) is more sensitive today than it was before."
The Bank of Canada has justified its aggressive rate hikes by arguing that the economy is overheated and needs higher interest rates to bring inflation down.
Caranci said the Bank of Canada may find recent inflation data encouraging.
Canada's annual inflation rate in October was 6.9 per cent, down from a peak of 8.1 per cent in June but still well above the central bank's two per cent target.
However, Caranci noted the three-month annualized inflation rate has dropped to below four per cent.
The economy has shown other signs of slowing, including a drop in household spending in the third quarter.
If the economy is indeed slowing, though, it hasn't showed up in labour data yet. Canada's unemployment rate in November was 5.1, signalling a still hot labour market.
Labour groups have been particularly concerned about the effect rate hikes will have on the employment.
But economists like Gordon say unemployment may not rise as much as it typically does during recessions because the economy is starting from a point of very low unemployment.
"You might actually see along the way two consecutive quarters of real GDP declining" -- the technical definition of a recession -- "but I'm not going too inclined to think that's really much of a recession," he said.
Next week, market watchers will be paying attention to the size of the rate hike as well as the Bank of Canada's language in its press release for hints on whether more rate hikes should be expected.
Caranci said December may very well not be the last rate hike.
"I think we could still get one more in January." she said.
"I would not pull it off the table."
This report by The Canadian Press was first published Dec. 2, 2022
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