While Macklem focused much of his speech on monetary policy and price stability, he also addressed the risk that recent U.S. and European financial instability could spread. After eight consecutive rate hikes, the bank said in January that it would pause its tightening campaign and not raise rates again if inflation came down as expected. The bank's baseline scenario sees the labor market softening as growth slows, easing wage pressure and business price-setting behavior, Macklem said.