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The Governor highlighted the global slowdown as the major economic challenge of the past year. But he said that there were also key changes within the Bank of Canada related to the implementation of monetary policy. In particular, he spoke of the success of the Bank's new system of eight fixed dates per year for announcing interest rate decisions. He also set out in detail the process that leads to those decisions.

The Bank of Canada today held its target for the overnight rate at 4½%, with the Bank Rate at 4¾% and the deposit rate at 4½%. The Bank is also continuing its policy of quantitative tightening.

Quarterly Financial Report - Third Quarter 2017 - For the period ended September 30, 2017

The 2002 Bank of Canada Conference focused on price adjustment, a critically important issue for monetary policy. Given the acceptance throughout the 1990s and 2000s of the existence of price stickiness in goods or labour markets, or both, and of the important role that monetary policy can play in an economy, the time was right for a conference that would focus on current developments in this area of research, particularly within a Canadian context. Conference papers covering both theoretical and empirical studies explored such themes as sources of the persistence of inflation, forward-looking models of inflation, models of inflation in open economies, the macroeconomic effects of technology shocks, and models of the interaction between wages, prices, and real economic outcomes.

The Canadian economy has undergone a dramatic transformation over the past decade. And it has emerged as a low-inflation economy, with declining levels of public and foreign debt and a private sector that is more cost-conscious, productive, and efficient, thanks to restructuring and investments in new technology.

The recent financial crisis and global economic slowdown have renewed interest in monetary policy options when the policy interest rate is at or near zero.

One of the most important arguments in favour of price stability is that unexpected inflation generates changes in the distribution of income and wealth among different economic agents. These redistributions occur because many loans are specified in fixed dollar terms and unexpected inflation redistributes wealth from creditors to debtors by reducing the real value of nominal assets and liabilities.

This year also marks the 70th anniversary of the creation of the Bank of Canada, and we too have taken the time to celebrate our contributions to Canada. At such times, while it is appropriate to look back and celebrate history and accomplishments, it is also a good opportunity to look forward and think about where we are headed. In this spirit, I'd like to talk to you today about one of our main responsibilities; that is, the conduct of monetary policy.

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.

The Bank of Canada today announced that it is maintaining its target for the overnight rate at 1 per cent. The Bank Rate is correspondingly 1 1/4 per cent and the deposit rate is 3/4 per cent.