Speeches and appearances

The Canadian economy has been expanding strongly so far this year and is now operating fairly close to its full production capacity. Consumer price inflation has risen above the 2 per cent target and is expected to rise further before year-end because of high oil prices and a number of other relative price movements.

The Canadian economy has been expanding strongly so far this year and is now operating fairly close to its full production capacity. Consumer price inflation has risen above the 2 per cent target and is expected to rise further before year-end because of high oil prices and a number of other relative price movements.

Today, we released our October Monetary Policy Report, in which we discuss economic and financial trends in the context of Canada's inflation-control strategy.

Given the extent of uncertainty in the world today, we are all naturally preoccupied with near-term issues and prospects. That's understandable. But, at the same time, it's critical that we look past the short-term to the longer-term trends and potential of our economy.

The question before us sounds straightforward: "Should Canada adopt the U.S. dollar?" But the issues are complicated. I will not pretend that I can cover all the nuances of this topic in my allotted time. So I am running the risk that I may oversimplify matters.

Indeed, a strong research environment has long been a hallmark of the Bank. We also want to encourage research relevant to our business, especially with respect to monetary policy and financial system stability, at universities all across Canada.

What I propose to do on this panel today is to talk about stabilization policy and policy co-operation from the viewpoint of an industrial country that has a floating exchange rate and both an explicit inflation target for monetary policy and a clear objective for fiscal policy.

Today, we published our Update to the April Monetary Policy Report, in which we discuss economic and financial trends in the context of Canada's inflation-control strategy.

But first, I would like to address an important subject; that is, how to promote the efficient operation of Canada's financial markets. Rather than approaching this topic in a detailed, technical way, I want to speak about two qualities that are essential to their efficient operation: trust and transparency.

Queen's motto is Sapientia et Doctrina Stabilitas, which we generally translate as "Wisdom and knowledge shall be the strength of thy times." This motto is especially pertinent to you as engineers graduating today.