telecommunications, where world production has been running ahead of demand. these three high - profile sectors naturally attract a lot of attention, especially in parts of canada with a heavy concentration in such industries. weakness also continues in sectors that produce non - energy commodities. but we must keep a sense of perspective. there is still considerable strength in other important areas of our economy. the latest data show that investments in the energy sector are very strong. and, except for autos, retail sales are solid. in addition, activity in housing, non - residential construction, and most other service industries remains firm. when we weighed all of the evidence in early march, we concluded that there was, in the near term, room for more monetary stimulus without risking pressures on capacity and inflation. on 6 march, we cut the bank rate by another 50 basis points, bringing the total reduction since january to 75 basis points. these lower domestic interest rates and rising disposable incomes, aided by recent tax cuts, should help to support the growth of domestic demand in canada in the second half of 2001. this additional stimulus to economic activity is consistent with keeping the core rate of inflation in canada close to the 2 per cent midpoint of the inflation - control target range. we see total cpi inflation moving down to about 2 per cent in the second half of 2001, if world oil prices remain around current levels. all in all, as we look ahead through this year and into 2002, the bank remains positive about canada's economic prospects. the recent volatility in exchange rates, both here in canada and in many other countries, has generated considerable public commentary, and i would like to say a word about that. what we have been seeing is a strengthening of the u. s. dollar against all major currencies despite the marked slowdown in u. s. economic growth. since the exchange rate is a key price in the canadian economy, the bank recognizes that movements in its value can be a source of concern for canadians. i want to reassure you that the bank watches market developments closely and carefully assesses the effects of currency movements on aggregate demand and inflation in canada. in closing, mr. chairman, let me emphasize two points. first, although we expect reasonable growth to resume in the second half of the year, there are risks and uncertainties attached to this projection. these risks stem from global and, especially, u. s. developments. although a moderation of u. s. demand was needed

. that is why good supervision is paramount. rules are only as good as the supervisors who enforce them, and good supervisors look beyond the letter of the rules to their spirit. of course, belief by the industry in the appropriateness of the measures will also aid their application. as you are well aware, you have the ultimate duty to ensure your institutions bear responsibly the risks you are taking. we have all learned from the events of the past few years, and so i look forward to a continued constructive dialogue with the iif as we develop and implement this vital agenda. see also : financial system reform initiatives mark real progress, says mark carney, governor of the bank of canada ( press releases ) assessment for canada, ” august 2010, and m. carney, “ bundesbank lecture 2010 : the economic consequences of the reforms, ” speech to deutsche bundesbank, berlin, 14 september 2010. bis central bankers ’ speeches