Growth in the Canadian economy has been essentially in line with the expectations set out in the Bank’s January  Monetary Policy Report Update. But inflation has been higher than expected because pressures on capacity over the past year have been stronger than previously judged, and the prices of food and gasoline have recently risen more than expected. After considering the full range of indicators, the Bank now judges that the Canadian economy was operating just above its production capacity in the first quarter of this year.

MPR Summary - April 2007