the policy interest rate amid many unknowns to meet our inflation objective. we also must follow through by communicating with canadians and with financial markets about our outlook for the economy and inflation. with that in mind, my remarks today will cover three points : first, how the canadian economy has evolved since our quarterly monetary policy report ( mpr ) in july ; next, how we have factored developments on the trade side into our outlook ; and, finally, i will give you a sense of governing council ’ s deliberations that led to our decision yesterday to hold our policy rate steady. recent economic developments when it comes to economic developments, canada has been thrown several curve balls over the past decade : the financial crisis ; lower commodity prices ; and now, trade tensions. it was only a little over a year ago that we could see that the adjustment to lower oil prices was sufficiently behind us to begin withdrawing the monetary stimulus we had put in place in 2015. we have raised the policy rate four times since july 2017, to 1 1 / 2 per cent. during this period, overall canadian economic performance has been solid and broad - based. growth has been running close to potential, the rate at which the economy can grow on a sustained basis without sparking too much inflation. and core inflation measures are now around 2 per cent. today, the policy rate is still relatively low — by that i mean that it is lower than what we would consider to be a “ neutral ” rate of interest. 1 the data and other information we have received since july reaffirm governing council ’ s view that higher interest rates will be required to achieve our inflation target. in fact, the global economy is performing largely as we expected, and that is a good thing because it will support growth here at home. our neighbour to the south has seen particularly strong demand, driven by household and business spending. some jurisdictions, though, are showing signs of weaker momentum, which may be partly linked to trade measures and uncertainty about trade policy. meanwhile, the most recent data for canada indicate that growth should average near potential over the next couple of years. some of you might recall that in our july forecast we were counting on a quick rebound from the marked slowdown in gross domestic product ( gdp ) growth that we saw during the first quarter of this year. this was an important call because it the bank estimates that the neutral rate of interest ( nominal ) is between 2. 5 and 3. 5 per cent. for more details,

david dodge : monetary policy report update opening statement by mr david dodge, governor of the bank of canada, at a press conference following the release of the monetary policy report update, ottawa, ontario, 13 july 2006. * * * today, we released our july monetary policy report update, which discusses current economic and financial trends in the context of canada's inflation - control strategy. overall, the bank's outlook for growth and inflation in canada is largely unchanged from that in its april monetary policy report ( mpr ). growth in the first half of 2006 appears to have been a little stronger than projected, and the canadian dollar has traded in a higher range than was envisaged in the april mpr. the economy is currently judged to be operating just above its production capacity. growth in 2007 - 08 is expected to be a little weaker than was anticipated in the april mpr, owing primarily to the lagged effects of the higher canadian dollar. with some anticipated moderation in u. s. growth, combined with past interest rate and exchange rate increases, the canadian economy is projected to return to its production capacity by the end of 2008. the bank projects economic growth of 3. 2 per cent in 2006, 2. 9 per cent in 2007, and 2. 8 per cent in 2008. total cpi inflation is expected to average just over 1 1 / 2 per cent from mid - 2006 to mid - 2007 with the reduction in the gst lowering the inflation rate by 0. 6 percentage points over this period - and then return to the 2 per cent target and remain there through the projection period. core inflation should also remain at about 2 per cent through to the end of 2008. there are important upside and downside risks to the bank's projection. but the bank continues to judge that these risks are roughly balanced, with a small tilt to the downside later in the projection period because of the possibility of a disorderly resolution of global imbalances. on 11 july, the bank kept its target for the overnight rate unchanged at 4. 25 per cent. the current level of this policy rate is judged, at this time, to be consistent with achieving the inflation target over the medium term. the bank will continue to monitor global and domestic economic and financial developments, including adjustments in the canadian economy, relative to its projection.