Bank of Canada Governor Stephen Poloz says stocks were destined for a correction after a "spectacular" surge, and COVID-19 just happens to be the catalyst.

"Did you really think the rise in markets over the past 12 months would hang in there? I mean, it was pretty spectacular," he told BNN Bloomberg’s Amanda Lang in an exclusive interview Thursday afternoon.

"So it might not have been a virus, it could have been something else – a political development or something that would have caused that thing to correct. I'm not dismissing the virus, it matters a great deal to markets. But let's face it: we were in a situation where a correction wouldn’t have surprised any of us for any reason."

Equity markets have experienced wild swings this week as investors grapple with wave after wave of headlines tied to the spread of COVID-19, with selling pressure interrupted only by intermittent hope for stimulus from monetary and fiscal authorities.

"What we’re dealing with is such a huge amount of uncertainty, the markets are going to react to the news they get today," Poloz said. "So, yeah the [U.S. Federal Reserve's emergency] rate cut was welcome from the market’s point of view, but then there’s news flow four hours later." 

The intraday volatility has been particularly acute in recent days. On Tuesday, when the Fed announced its half-point cut, the Dow Jones Industrial Average swung from an early gain of 381 points to being down as much as 997 points. As investors' fraying nerves become increasingly evident, Poloz wants them to understand policymakers aren't letting down their guard.

"We’re just going to have to work our way through it," Poloz said. "And know that in the past when we've had instances like this, we have worked through it. And that’s what the tools are for.”

“We’re on the job. We’re doing everything that’s in our power."