stephen s poloz : release of the financial system review opening statement by mr stephen s poloz, governor of the bank of canada, at the press conference following the release of the financial system review, ottawa, ontario, 12 june 2014. * * * good morning. it is my pleasure to hold this press conference with carolyn wilkins. carolyn assumed the post of senior deputy governor of the bank of canada on the 2nd of may. we are pleased to be here with you today for the inaugural press conference for the financial system review ( fsr ). the bank published the june issue this morning. an important part of the bank ’ s work is to promote a stable and efficient financial system. we do this in a number of ways : providing liquidity facilities and serving as lender of last resort ; overseeing key domestic clearing and settlement systems ; and collaborating with domestic and international policy - makers to develop and implement policy. our research and analysis of financial stability is vital to this work. since 2002, the fsr has been our flagship publication for promoting informed public discussion on all aspects of the financial system. this morning ’ s press conference extends that effort. our job today is to help you leave with a solid understanding of the bank ’ s assessment of financial stability in canada, an appreciation of the complexity of the analysis and, importantly, how this work fits into our thinking about bank policy. let me provide some context. over the two decades leading up to the global financial crisis, a consensus emerged that keeping inflation low, stable and predictable was the best contribution that monetary policy could make to the financial well - being of canadians. our inflation - targeting framework has always had a degree of flexibility built into it ; and financial stability issues have always been part of the discussion. however, the crisis crystallized the view that financial stability and the outlook for economic growth and inflation are intrinsically linked. as a result, the bank of canada – like many other central banks – is reconsidering how to better integrate financial stability and monetary policy objectives. the assessment of financial stability is becoming more rigorous and now follows a more structured analytical process, informed by models, better data and richer dialogue. this leads to more informed judgments around the risks to the financial system. in this issue of the fsr, we have introduced an enhanced framework that explicitly identifies the underlying vulnerabilities in canada. these are the pre - existing conditions that could amplify and propagate shocks through the canadian system, regardless of where

tiff macklem : central banking - navigating in a new world remarks by mr tiff macklem, governor of the bank of canada, at the 30th conference of montreal " international economic forum of the americas ", montreal, quebec, 12 june 2024. * * * good afternoon. it's always great to be back in montreal, my hometown. and i could not be more pleased to be here with joachim nagel, president of the deutsche bundesbank. thank you for visiting us in canada. since i'm on my home turf, let me start us off with a few words about where we find ourselves in economic history. key lessons from high inflation canada and germany have just come through the biggest inflation we've experienced in 40 years. and as painful as this has been, it has highlighted some lessons. i will focus on three in the canadian context. first, we ignore the supply - side of the economy at our peril. as central banks, we tend to focus on the demand side because that's what we influence with interest rates. but coming out of the pandemic, we learned that it is much easier to restore demand than supply. high inflation was a stark reminder that supply shocks can cumulate and persistand when they intersect with periods of strong demand, the inflationary consequences can be large. looking ahead, technological change, geopolitical tensions, climate change, and shifting trade and investment flows all suggest we may experience more supply shocks than we did in the past. businesses and central banks need to be ready. second, inflation is painful - that's not a new lesson, but for many of our citizens it was their first experience with high inflation. and it has been painful. inflation harms people and the economy, and it corrodes trust in our market - based system. the rising cost of living made life harder for everyone, especially those who had less to start with. people were working hard, but their paycheques didn't buy what they used to. that made people feel cheated and angry. recent history has been a stark reminder that inflation is our common enemy. the third lesson is the value of central bank credibility and public trust. we did not have that in the 1970s, and the costs of unwinding inflation were very high. this time, our track record on inflation control combined with our forceful monetary response brought inflation back down at much lower economic cost. but public trust and central bank credibility