"This adjustment reflects continued progress towards recovery and the Bank's increased confidence in the strength of the Canadian economic outlook," it said in a statement. "However, these negative effects are waning, and the downside risks associated with the pandemic have significantly diminished," the Bank said in its summer monetary policy report. Inflation is now expected to remain at or above 3% - the top of the central bank's 1%-3% inflation control range - through the rest of 2021 on temporary factors related to the pandemic, easing back to the 2% target by 2022 as those factors fade.