The Globe and Mail reports in its Friday, Dec. 8, edition that home construction has not kept pace with heightened levels of population growth, driving up shelter inflation to the highest it has been in decades, a senior Bank of Canada official said Thursday in the bank's most explicit statement yet on how the country's housing and immigration ambitions collide. The Globe's Mark Rendell writes that deputy governor Toni Gravelle said that high levels of immigration help keep inflation in check over the long run by expanding the labour force and increasing Canada's potential growth. However, in the short term, rapid population growth without a significant increase in home building is driving up housing costs -- one of the largest components of overall inflation. Mr. Gravelle said: "This jump in demographic demand coupled with existing structural supply issues could explain why rent inflation continues to climb in Canada. It also helps explain, in part, why housing prices have not fallen as much as we expected." He urged all levels of government to work together to reduce barriers to home construction, which include zoning restrictions, permitting delays and a shortage of construction workers.