, the bank of canada responded forcefully, raising its policy interest rate from 0. 25 % a year ago to 4. 50 % today. that is working to reduce demand and rebalance the economy. we're still a long way from our inflation target, but recent developments have reinforced our confidence that inflation is coming down. and we are committed to getting inflation all the way back to 2 % so canadians can once again count on low, stable and predictable inflation and sustainable economic growth. with that overview, the senior deputy governor and i would be pleased to take your questions. 2 / 3 bis - central bankers'speeches 3 / 3 bis - central bankers'speeches

skill level of the canadian workforce. business and governments need to continue to focus on workplace training as the competitiveness of our industries and the very nature of work continue to evolve. the more canadian businesses refocus, retool and retrain, the more they can take advantage of opportunities in canada and around the world. current economic conditions in canada let me conclude with some comments on current economic conditions in canada, which reflect a number of the themes i have discussed. the recoveries in canada ’ s major trading partners continue to be dampened by the ongoing need to repair sovereign, bank and household balance sheets. as a consequence, the level of external demand for our products in advanced economies remains weak. that said, in recent months, the considerable external headwinds have abated somewhat. european bank funding and sovereign debt markets have stabilized, global financial conditions have improved and risk aversion has decreased. this creates a window for european authorities to address the deep structural issues in their monetary union. while the european situation is far from resolved, the challenges have moved from the acute to the chronic. the u. s. economy remains on the modest growth path typical of recoveries following financial crises. given that context, recent data have been encouraging. monthly employment gains in the past three months have been the fastest in a year. consumer and business confidence have rebounded. and fundamentals for household spending have improved with higher personal income and household net worth. although activity in a number of emerging - market economies has slowed, the emerging world remains the engine of global growth. in particular, past tightening of policy and weaker external demand are slowing activity in china to a still - robust pace. improving global economic conditions have contributed to higher commodity prices, with geopolitical risks adding a further premium on crude oil prices. innovation canada : a call to action, review of federal support to research and development, ” expert panel report, october, 2011. j. manyika, s. lund, b. auguste, and s. ramaswamy, “ help wanted : the future of work in advanced economies, ” mckinsey global institute discussion paper, march 2012. bis central bankers ’ speeches conditions in the canadian economy have also been somewhat stronger and the degree of slack somewhat smaller than the bank had expected. growth has been a bit quicker in recent quarters, reflecting a combination of temporary factors as well as improved confidence and better financial conditions. although net exports have picked up somewhat due to stronger u. s.