not expected to be above zero until the end of this year. if the forecast proves correct, the real repo rate will have been negative for a two - year period – this is very unusual in an historical perspective. the riksbank ’ s assessment is that a long - term normal level for the real repo rate is around 2 per cent. 9 seen from this perspective, the repo rate path thus indicates a very expansionary monetary policy. we have previously seen that in april the market was expecting a lower nominal repo rate in relation to the riksbank ’ s forecast. figure 6 shows that this also appeared to apply to the real repo rate. figure 6 the riksbank ’ s real repo rate forecast per cent note. see footnote 8 for a description of the calculation of the real repo rate expectations. sources : reuters ecowin, tns sifo prospera and the riksbank. the real repo rate forecast is calculated as a mean value of the riksbank ’ s repo rate forecast for the coming year minus the inflation forecast ( cpif ) for the corresponding period. prospera ’ s interest rate and inflation expectations are based on surveys carried out on 28 april and 28 april – 7 may respectively. interpolation has been used for the interest rate and inflation expectations to produce the expected repo rate for the coming year and inflation expectations for the corresponding period. “ forward rates minus prospera inflation expectations ” shows nominal forward rates from 28 april for the coming year minus inflation expectations according to prospera for the corresponding period. see the box “ what is a normal level for the repo rate? ” in the monetary policy report, february 2010 for a discussion of a normal level for the repo rate. see also bjorn lagerwall “ real interest rates in sweden ”, economic commentary no. 5, 2008, sveriges riksbank, for a discussion of real interest rates. concluding thoughts publishing our own repo rate path was a further step towards openness and transparency in the riksbank ’ s monetary policy. our forecast for the repo rate is reported in the same way as other important forecast variables. we can also use alternative scenarios to illustrate how the executive board may respond with its monetary policy if economic developments deviate from the main scenario. when the riksbank introduced the repo rate path there were fears that many analysts would stop making their own forecasts and slavishly

targeting regime. next year, we will answer the question of whether the bank should continue to focus on one pre - eminent measure of core inflation and, if so, whether our current core measure will remain in that role. in our interest rate announcement earlier this month, the bank noted that the resource sector is continuing to adjust to lower prices, and that these complex adjustments will take considerable time. our inflation - targeting regime will help facilitate these adjustments. canada has seen this movie before – we ’ ve managed it well in the past, and i ’ m confident we will continue to manage it well in the future. conclusion it ’ s time to conclude. as albertans know well, it can be hard to ride the cycles in raw materials prices. but resource price fluctuations affect all countries, whether they are consumers or producers. canada is fortunate to be both, and we shouldn ’ t ignore the resources that we have been blessed with. natural resources bring opportunities. over the years, canadians have used our endowment to build a prosperous economy. we will continue to do so. and rather than resist market forces, canadians should heed the signals sent by price movements. we ’ ve adjusted to rising prices ; we can adjust to falling ones. these adjustments are never easy. they are often difficult and painful for affected individuals and their families. but they are necessary. for our part, the bank of canada will continue to promote low, stable and predictable inflation. doing so is the best contribution we can make to helping promote both strong, steady economic growth and the flexibility needed to ease those adjustments and help our resource - rich country thrive. bis central bankers ’ speeches