could act as a significant further drag on growth and put additional downward pressure on inflation. another important downside risk is that the global recovery could be even more protracted than projected. • on tuesday, the bank reaffirmed its conditional commitment to maintain its target for the overnight rate at the effective lower bound of 1 / 4 per cent until the end of june 2010 in order to achieve the inflation target. • the bank retains considerable flexibility in the conduct of monetary policy at low interest rates, consistent with the framework that we outlined in the april mpr.

mark carney : summary of the latest monetary policy report opening statement by mr mark carney, governor of the bank of canada, at the press conference following the release of the monetary policy report, ottawa, 18 april 2012. * * * good morning. tiff and i are pleased to be here with you today to discuss the april monetary policy report, which the bank published this morning. the profile for global economic growth has improved since the bank released its january mpr. europe is expected to emerge slowly from recession in the second half of 2012, although the risks around this outlook remain high. the profile for u. s. growth is slightly stronger. this reflects the balance of somewhat improved labour markets, financial conditions and confidence on the one hand, and emerging fiscal consolidation and ongoing household deleveraging on the other. economic activity in emerging - market economies is expected to moderate to a stillrobust pace over the projection horizon, supported by an easing of macroeconomic policies. commodity prices remain elevated owing to improved global economic prospects, supply disruptions and geopolitical risks. in particular, the international price of oil has risen further and is now considerably higher than that received by canadian producers. if sustained, these oil price developments could dampen the improvement in economic momentum. overall, economic momentum in canada is slightly firmer than the bank had expected in january. the external headwinds facing canada have abated somewhat, with the u. s. recovery more resilient and financial conditions more supportive than previously anticipated. as a result, business and household confidence are improving faster than forecast. the bank projects that private domestic demand will account for almost all of canada ’ s economic growth over the projection horizon. household spending is expected to remain high relative to gdp as households add to their debt burden, which remains the biggest domestic risk. business investment is projected to remain robust, reflecting solid balance sheets, very favourable credit conditions, continuing strong terms of trade and heightened competitive pressures. the contribution of government spending to growth is expected to be quite modest over the projection horizon, in line with recent federal and provincial budgets. the recovery in net exports is likely to remain weak in light of modest external demand and ongoing competitiveness challenges, including the persistent strength of the canadian dollar. the bank projects that the economy will grow by 2. 4 per cent in both 2012 and 2013 before moderating to 2. 2 per cent in 2014. the degree of economic slack has been somewhat smaller than anticipated, and the economy is