Something happened recently that didn’t make many headlines — but it should have.
The Bank of Canada quietly hinted that it might change how it measures inflation.
Specifically, they’re looking at ways to adjust or remove mortgage interest costs from the Consumer Price Index (CPI) — the same number they use to guide interest rate decisions.
At first glance, that might sound like boring technical jargon. But it’s not. It’s a big deal.
Why this matters more than most people think
CPI is supposed to track the cost of living. And central banks use it to decide whether to raise or cut rates.
But there’s a problem: mortgage costs are part of CPI, and rate hikes directly affect mortgage costs.
So every time the Bank of Canada raises rates to “fight inflation,” it pushes mortgage payments higher… which pushes CPI higher… which looks like more inflation… which puts pressure to raise rates again.
It’s a circular loop — like a dog chasing its tail.
Now, instead of fixing the policy mistake, the Bank is suggesting it might fix the math by redefining how inflation is measured.
If the numbers don’t tell the right story, maybe the story needs new numbers.
Time to start thinking critically
This is why I keep stressing the importance of critical thinking — something I talk about with my own kids all the time.
It’s not about being cynical. It’s about asking better questions:
- Why is the central bank rethinking how it measures inflation now?
- What does that say about the reliability of the data we base big decisions on?
- And if the rules keep changing, should we really build our financial strategy around them?
The truth is, you can’t build long-term financial security based solely on government stats, headlines, or official forecasts. Those things shift. They’re revised. They’re often designed to tell a particular story.
What doesn’t change
Instead of chasing numbers, build your plan around principles that don’t move:
- Own real assets — ones that hold value even as the dollar erodes.
- Use debt strategically — not as a burden, but as a tool to grow.
- Stay curious and question the narrative — so you’re thinking several steps ahead, not reacting to yesterday’s headlines.
Because whether CPI is 2%, 4%, or 6%, the reality is the same:
Your dollars buy less every year.
Your savings lose purchasing power quietly in the background.
And the people who understand the game — and adapt — are the ones who come out ahead.
If you’re wondering how to position yourself or your mortgage in a system where the “rules” keep changing, let’s talk.
Talk soon,
— Vince
P.S. You don’t need to become an economist. You just need to think critically — and build a financial strategy that works no matter how they choose to define “inflation” next year.
