January 2013 - Monetary Policy Report press conference: annotated video

Webcast of a press conference by Governor Mark Carney and Senior Deputy Governor Tiff Macklem.

Questions

Please note that questions as listed below may have been edited to improve clarity and brevity. Viewers can reference the actual questions in the video webcast.

• Question 1: Economists say the Bank is as dovish as can be while still maintaining a tightening bias. Why don’t you get rid of the tightening bias altogether, and do you categorically rule out a rate cut?
• Question 2: Is your tightening bias solely because of economic and inflation projections, or is it also partly due to financial stability concerns in relation to the household sector?
• Question 3: According to your report, the growth rate of Canadian household debt is stabilizing somewhat, but the level of indebtedness remains at an all-time high, at 165 per cent. Do you not find that you are letting down your guard too soon by announcing that you do not foresee a rate increase in the near future?
• Question 4: You mentioned the level of Canada’s exports among the downside risks. Central banks are currently acquiring assets to help their exports. What can Canada do? Is this not a case of David versus Goliath?
• Question 5: How much responsibility does the Bank of Canada have for why Canadians took on so much debt, given the Bank has been keeping interest rates low?
• Question 6: How important is the United Kingdom staying in the European Union for that region’s economy, and what would the implications be for you in your new role as Governor of the Bank of England if the United Kingdom votes to leave the European Union?
• Question 7: Concerning reports in The Globe and Mail about your vacation last summer at MP Scott Brison’s cottage, was this the first time you spent a holiday with either Mr. Brison or any Member of Parliament during your time as Governor?
• Question 8: Knowing the events of last summer and the questions by the New Democratic Party about why the Bank’s inflation-targeting policy does not put more stress on labour output, supporters of the Official Opposition may say you have politicized the position of Governor of the Bank of Canada.
• Question 9: The Monetary Policy Report talks about the economic toll taken by the discount of Western Canadian crude oil compared with the price of U.S. crude. Can you square why the Report forecasts economic growth this year of 2.7 per cent, but the International Monetary Fund is only predicting growth of 2.3 per cent?
• Question 10: Can you address the criticism by Mr. Adam Posen that the Bank of England Governor is too powerful?
• Question 11: The Monetary Policy Report talks about the risks pertaining to the economy in the European Union. What do you think should be done to improve the economy in Europe?
• Question 12: Looking ahead to your job at the Bank of England, do you think that monetary policy in the United Kingdom has been appropriate in terms of maintaining low inflation while trying to stimulate the economy?
• Question 13: You indicate that monetary tightening is less imminent. The main domestic issue seems to be household indebtedness; yet in order to boost savings, it must be rewarded. If, in fact, household indebtedness is such a major problem in Canada, why is financial repression still being used?
• Question 14: What are the “constructive trends” that the Monetary Policy Report says are now under way that impact the situation with household debt?
• Question 15: In Davos, proposals have been tabled to address the fact that some banks are too big to manage. Do you belong to that school of thought?