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Our interest in income trusts relates to the efficient functioning and health of Canada's financial system. A safe and efficient financial system is essential to Canada's economic well-being. The Bank of Canada works with other government agencies, as well as market participants, to promote the safe and efficient functioning of the financial system.

"This simple paradigm is very helpful because monetary policy works better when it is understood," the Governor said.

The Bank of Canada has been around for over 70 years. Throughout this period, the Bank has had one over-arching mandate: to promote the economic and financial welfare of Canadians. Over the years, we have learned that the best contribution that monetary policy can make in this regard is to give Canadians confidence in the future value of their money.

he Bank of Canada today released the January update to the Monetary Policy Report, which discusses current economic and financial trends in the context of Canada's inflation-control strategy.

The Canadian economy is judged to have been operating at, or just above, its production capacity at the end of 2006, following weaker-than-expected growth in the second half of last year. This slowdown stemmed from reduced demand for Canadian exports - related to weakness in the U.S. automotive and housing sectors - and from the need for Canadian businesses to adjust inventories.