target will be slow, and risks remain. overall, our outlook for both growth and inflation is largely unchanged from when we were here in october. economic growth is expected to be modest in 2024 - weak in the first half before picking up around the middle of the year and rising to about 2½ % in 2025. with downward and upward forces largely offsetting in the near term, cpi inflation is expected to remain close to 3 % over the first half of this year. it is then expected to ease to about 2½ % by year end and return to target in 2025. let me give you a sense of governing council's monetary policy deliberations. at our decision last week, there was a clear consensus to maintain our policy rate at 5 %. we also discussed where we see the economy and inflation going and what that could mean for monetary policy going forward. what came through in the deliberations is that governing council's discussion about future policy is shifting from whether monetary policy is restrictive enough to how long to maintain the current restrictive stance. that doesn't mean we have ruled out further policy rate increases. if new developments push inflation higher, we may still need to raise rates. but what it does mean is that if the economy evolves broadly in line with the projection we published last week, i expect future discussions will be about how long we maintain the policy rate at 5 %. governing council is concerned about the persistence of underlying inflation. we want to see inflationary pressures continue to ease and clear downward momentum in underlying inflation. we also discussed the risks to the economy and inflation. we are trying to balance the risks of over - and under - tightening. we don't want to cool the economy more than necessary. but we don't want canadians to have to continue to live with elevated inflation either. we remain focused on a number of indicators of underlying inflationary pressures. we need to see further and sustained easing of core inflation. with the economy now looking to be in modest excess supply, demand pressures have abated. corporate pricing behaviour has continued to normalize. at the same time, measures of near - term inflation expectations and wage growth suggest that underlying inflationary pressures remain. let me conclude. we've come a long way from the inflation peak in 2022. monetary policy is working, and we need to continue to let it work. we remain resolute in our commitment to return inflation to the 2 % target. with that summary

the bond market. the banks became a vital link in the national economy, their expansion and that of other icelandic companies garnered widespread support, they offered handsome salaries, and they paid the treasury sizeable tax revenues, directly and indirectly. the banks attracted international attention late in 2005 and early in 2006. the market became more wary of them, their cds spreads began rising toward the end of 2005, and they received more probing and critical coverage by the media and others than they were accustomed to. the criticism was wide ranging, targeting the banks ’ growth pace, risk appetite, low deposit ratios and high dependence on borrowed funds, as well as cross ownership, lack of transparency, and so on. until that time, the banks had increasingly been active in the global bond market, with ever larger debt issues. in february 2006, iceland ’ s prime ministry, ministry of finance, ministry of business affairs, financial supervisory authority, and central bank concluded a collaboration agreement centring on financial stability and contingency measures. the government then established an advisory group on the basis of this agreement. the icelandic banks sought to respond in various ways to the criticism levelled at them. they greatly enhanced their information disclosure to the global marketplace, thus improving transparency in their operations. they sought to reduce cross - ownership, improve their liquidity position and capital ratios, and took the first steps toward increasing the share of deposits on the liabilities side of their balance sheets. they were strongly encouraged to do so by rating agencies and numerous foreign financial analysts, among others. landsbanki launched its icesave deposit accounts in the united kingdom toward the end of 2006. the banks also sought out new credit markets for example in the us which was wide open at the time for issuers with favourable credit ratings. because they took this action, the icelandic banks were perhaps better prepared than they would otherwise have been for the sudden changes that took place in the global financial markets in mid - 2007. in this context, i wish to cite the central bank ’ s 2007 financial stability report, which appeared in april that year. it contained the following statement : “ the central bank underlines that global market conditions can take a sudden turn for the worse and it is important to be on the alert and prepared for such a contingency. ” the report goes on to say : “ the current episode of ample liquidity and lower interest rates which has been ideal for riskseeking investors may change unexpectedly. short - term interest rates have been rising in most