in any way other than as prescribed by its underlying software. to create new units of value, cryptoassets must typically be “ mined ” by running energy - intensive computer computations. this is, in effect, a form of preprogrammed monetary policy : the purchasing power of the crypto tokens is determined by supply and demand, where the supply is limited by the enabling software. 5 this pre - programmed mechanism for creating cryptoassets was originally a key selling point. those who believed that central banks could not be trusted to maintain the value of money were attracted by the idea of a money that is untouched by any public institution or individual. 5 however, bitcoin allows the possibility of “ forking ” or the creation of two separate versions of the blockchain and two different cryptoassets. this implies that bitcoin ’ s claim to complete control of monetary growth is overstated. see j. abadi and m. brunnermeier, “ blockchain economics, ” august 25, 2018. - 4ironically, this very mechanism has turned out to be its fundamental flaw. when the limited supply of tokens meets large flows of demand from enthusiasts, the result — as we have seen — is wild fluctuations in the value of cryptoassets. these fluctuations have drawn in even more speculative money, which has further amplified the price movements. indeed, many canadians who purchased bitcoins in 2017 reported that they did so for “ investment ” purposes — and that really means speculation. 6 the implication of these price movements is that the purchasing power of cryptoassets is far less stable than that of almost any sovereign money. the value of a bitcoin in us dollars topped $ 20, 000 in the last year and is now down to around $ 6, 000. such wide price movements make it unlikely that the current crop of cryptoassets would ever be used as money for ordinary purposes when there is a stable national currency. cryptoassets are also very expensive to use. transaction costs were high in 2017 — as much as $ 55 per transaction — compared with almost zero for cash. 7 these costs have come down since then, but if transaction volumes push the limits of the network again, costs will jump back up. in short, the current crop of cryptoassets is not about to replace the canadian dollar or other national currencies. they are products that may be largely of interest to three

tiff macklem : opening statement before the house of commons standing committee on finance opening statement by mr tiff macklem, governor of the bank of canada, before the house of commons standing committee on finance, ottawa, ontario, 18 april 2023. * * * good morning. i'm pleased to be here with senior deputy governor carolyn rogers to discuss our recent policy announcement and the bank of canada's monetary policy report ( mpr ). last week, we maintained the policy rate at 4a½ % as we continue to assess whether monetary policy is restrictive enough to return inflation to our 2 % target. since the last time we were here with you, we've seen a steady improvement in inflation and modest economic growth. inflation is coming down quickly - data this morning show it fell to 4. 3 % in march. and we forecast it to be around 3 % this summer. we are encouraged by that, but we are also seized with the importance of staying the course and restoring price stability for canadians. several things still have to happen to get inflation all the way back to the 2 % target. inflation expectations have to come down further, services price inflation and wage growth need to moderate, and corporate pricing behaviour has to normalize. we are focused on these indicators, and the evolution of core inflation, to ensure that consumer price index ( cpi ) inflation continues to progress toward the target. if monetary policy is not restrictive enough to get us all the way back to the 2 % target, we are prepared to raise the policy rate further to get there. before i take your questions, let me give you some economic and financial context for the decision. the canadian economy remains in excess demand. gross domestic product ( gdp ) growth in the first quarter of the year appears stronger than we projected in january, and the labour market is still tight. the unemployment rate, at 5 %, remains near its record low, and wages continue to grow in the 4 % to 5 % range. employment growth has been surprisingly strong, reflecting continued demand and increases in labour supply. past policy rate increases are working their way through the economy and restraining demand. households are slowing their spending, particularly on big - ticket items. as mortgages are renewed at higher rates, more households will feel the restraining effects of monetary policy. taking these forces into consideration, we expect canadian gdp growth to be weak for the rest of this year before beginning to pick up gradually in 2024 and through 2025. what does all