remarks by paul beaudry deputy governor alberta school of business february 16, 2023 edmonton, alberta no two ways about it : why the bank is committed to getting back to 2 % introduction good afternoon. bonjour tout le monde. it is a pleasure to be here in edmonton. we have all been going through challenging economic times recently. almost exactly three years ago, the covid - 19 pandemic hit canada, suddenly shutting down large parts of our economy. this upended our lives and livelihoods and created a huge disruption in financial markets. fiscal and public health policies led the charge in tackling these dangers. the bank of canada played a key supporting role by reducing its policy interest rate to near zero and unblocking a financial system that was clogging up. the recession caused by the pandemic was unprecedented. canada lost over 3 million jobs, and the unemployment rate rose to 14 % in may 2020. and, as many here likely recall, oil prices even briefly turned negative. fortunately, though, when the economy reopened after the mass closures, the rebound was also unprecedented. by the end of 2021, canadian employment was 250, 000 jobs above its pre - pandemic level, and the unemployment rate had fallen to 6 %. but a storm was brewing. supply chain bottlenecks, higher energy prices and a massive shift in global consumption patterns came together to spur inflationary pressures. the disruptions caused by the war in ukraine only added fuel to this fire. in response, the bank raised its policy interest rate to 4. 5 % in a series of rapid hikes. these interest rate increases are working. over the past few months, inflation has started to come down. recently it reached 6. 3 %, down from a peak of 8. 1 % last summer. this is a welcome improvement. but inflation is still too high and far from the bank ’ s 2 % target. at its current level, it continues to cause hardships for canadians, especially the most vulnerable among us. while canada may have turned the corner on inflation, we know that it will take time to get back to the bank ’ s inflation target. so, i ’ d like to take this opportunity i would like to thank thomas carter, luis uzeda and martin harding for their help in preparing this speech. not for publication before february 16, 2023 5 : 55 p. m. eastern time - 2to talk about the importance of staying the course in

the success of the current framework. a concerted and ambitious research agenda focused on evaluating whether two specific changes – targeting a lower rate of inflation or a path for the level of prices – could provide significant net benefits to the canadian economy and canadian households. subsequently, the experience of the global financial and economic crisis prompted the bank to add a third item to its research agenda – asking to what extent monetary policy should take account of financial stability considerations. allow me to highlight just some of the initiatives and work undertaken by the bank over the past five years. since 2008, we have had three major conferences for our staff and other researchers to present work on inflation targeting and the monetary policy framework. the most important of these research papers have been published in three special issues of the bank of canada review – winter 2007 – 08, spring 2009 and summer 2010. as well, governing council members have spoken regularly and publicly about the issues. bis central bankers ’ speeches we have been pleased to answer questions before this committee regarding progress to date toward renewing the inflation - control target. and tiff and i are happy to answer more of these questions today, as well of course, questions about the outlook for the canadian economy. thank you. bis central bankers ’ speeches