But what we have seen since this summer is a widening of the spread between short-term market interest rates, such as the rate for commercial paper, and our target for the overnight rate.
This is important, because these short-term market rates are a crucial link in the way monetary policy is transmitted: from our key policy rate, to the cost of credit, to spending, production, employment and, ultimately, to the rate of inflation. These wider spreads have persisted, and they represent a tightening of credit conditions in Canada.