consensus. the process of policy development allows members to input their views at each stage, thereby ensuring collective ownership of the policy decisions. the fsb relies on moral suasion, or what political scientists like to call “ soft power. ” as such, the fsb wields no legal sanctions but encourages countries to adhere to global standards and promotes a “ race to the top ” through disclosure and peer pressure. the fsb or its member standard - setting bodies regularly produce peer - led, country - by - country assessments of compliance with global standards. the fsb charter affirms “ the fsb ’ s role in coordinating at the international level the work of national financial authorities and international standard setting bodies in developing and promoting the implementation of effective regulatory, supervisory and other financial sector policies in the interest of global financial stability ”. see : http : / / www. financialstabilityboard. org / publications / r _ 120809. pdf. the majority of fsb staff members are on temporary secondments from member institutions. in addition to the 70 member agencies from 24 member countries, the fsb has six regional consultative groups to disseminate information and collect feedback from an additional 70 non - member countries. broader implementation of global financial standards is important for supporting the ongoing process of global financial and economic integration. these standard - setting bodies include the basel committee on banking supervision ( bcbs ), the international association of insurance supervisors ( iais ), the international organization of securities commissions ( iosco ), the committee on payment and settlement systems ( cpss ), and the international accounting standards board ( iasb ). bis central bankers ’ speeches • because the fsb is a creation of the g - 20 leaders, it has the weight of the g - 20 behind it. the g - 20 provides direction and receives regular progress updates from the fsb on the financial reform agenda. this close working relationship gives the fsb the political leverage it needs to be effective. in short, the fsb was designed to succeed in its coordinating role. it is an efficient and inclusive international organization that can act nimbly to coordinate the efforts needed to address serious financial vulnerabilities. 7 the fsb may be small, but it is powerful, undertaking work of great significance to create a resilient, competitive and integrated global financial system, which is necessary to support a rapidly evolving global economy. countries such as canada, with open global financial markets and internationally active financial institutions, especially

today, inflation has averaged almost exactly 2 per cent. moreover, not only has inflation fallen, it has become more stable. indeed, the trend of inflation - as measured by what we call “ core inflation ” - has stayed within the target range almost continuously for the past 10 years. more importantly, we found that, after a few years of inflation targeting, the inflation expectations of canadians fell into line with the 2 per cent target. and expectations have remained close to the target in recent years. another major adjustment began in the middle of the 1990s. at that time, canada was facing an unsustainable fiscal situation. spending had to be put on a viable long - term course, and the ratio of public debt to gdp put on a steady downward track. by the middle of the decade, governments - federal and provincial - had begun to take the painful but necessary steps to balance their books and reduce their debt burdens. this fiscal adjustment helped improve the credibility of canada ’ s economic policies and reduced the risk premium that investors demanded on canadian government bonds. lower interest rates reduced debt - servicing costs and stimulated economic growth, which brought in more revenues for governments. the federal debt - togdp ratio has fallen to about 44 per cent, from a peak of close to 70 per cent. the ratio of total government liabilities to gdp has declined from a peak of about 100 per cent to about 80 per cent, according to the oecd. the other major change in the 1990s was the structural adjustments that took place in the public and private sectors. in both cases, these adjustments were enormously helpful, because they made the canadian economy more flexible. in the public sector, governments moved to reduce distortions in the economy, by eliminating many industrial subsidies, lowering income taxes, and putting the canada and quebec pension plans on a sustainable basis. further, the government made changes to its system of unemployment insurance, basing the program more on insurance principles and improving the employability of labour. in the private sector, businesses and employees faced restructuring in the wake of free - trade agreements, as canada opened up further to international competition. none of this was easy, but it did leave canada ’ s economy more flexible, and in a better position to handle economic shocks and, therefore, to grow sustainably. canada ’ s floating exchange rate helped facilitate the adjustments that were taking place on these various fronts. it helped by sending signals to businesses about the kinds of adjustments that were needed. firms that produced