and some jobs will not return either because of permanent changes in demand or the adoption of new technologies. so, we can expect a long adjustment process and a protracted recovery. the economy will need support for quite some time, and the bank will continue to do its part. but monetary policy alone can ’ t bring about a complete recovery. we all have a role to play to ensure the recovery is broad - based and sustained, with the benefits shared widely. this highlights the importance of targeted public policies, 6 a. barker, “ increasing inclusiveness for women, youth and seniors in canada, ” organisation for economic co - operation and development economics department working paper no. 1519 ( december 2018 ). 7 s. birinci, f. karahan, y. mercan and k. see, “ labor market policies during an epidemic, ” bank of canada staff working paper no. 2020 - 54 ( december 2020 ). - 10 businesses that invest in workers, and an education system that develops the skills needed in the 21st century. i look forward to working together to bring about this shared recovery. thank you.

, capital controls were essentially eliminated in 1951, well before this occurred in most other countries. moreover, the elimination of controls and the move to a flexible exchange rate facilitated the development of our domestic financial markets. and this, along with the floating exchange rate, helped the economy to make the necessary adjustments at a time when large numbers of canadians were leaving farms and moving into the cities. now let ’ s look at 1970, the second time we floated our currency. canada ’ s reasons for floating then were similar to those in 1950 ; that is, there was upward pressure on the canadian dollar and a rapid buildup of international reserves. this pressure came from high commodity prices, renewed capital inflows, and strong foreign demand for canadian goods - demand associated with a strong global economy and very loose fiscal policy in the united states. these pressures again led to concerns that an inflationary buildup in canada could lead to a boom - bust economic cycle. and once again, there were fears of speculative short - term inflows that would make the problem worse. the authorities looked at a number of alternatives, including the setting of a new higher value for the canadian dollar against the u. s. dollar and a revaluation with a wide band. but these options were rejected because they might have invited further speculative pressures. it was clear that the least risky option for canada was to return to a floating currency. domestic policy anchors the floating exchange rate again proved to be useful, because it eased the immediate inflationary pressures. but at the time, we did not understand that a flexible exchange rate alone does not provide a complete monetary policy framework. what was missing was a nominal anchor. what i mean by the term “ nominal anchor ” is a clear target for monetary policy, a way to give people confidence that policy is on track, and a way to tie down or “ anchor ” expectations of future inflation. the bank of canada searched for such an anchor throughout the 1970s and 1980s. the outcome of that search was our eventual adoption of inflation targets. in february 1991, the bank and the federal government announced a series of inflation - reduction targets. the authorities saw explicit inflation targets, with a clear time frame to achieve them, as a way to shape inflation expectations. this would make it easier to reduce inflation and, at the same time, make the central bank accountable for its actions. the inflation - control agreement has been extended three times, and since 1995 it has called for the bank to aim to keep inflation