And it has to do with reducing the toll that inflation takes on the economy and minimizing economic ups and downs. Put another way, if the goal of economic policies is a productive, well-functioning economy, capable of creating new jobs and delivering higher standards of living over time, then low and stable inflation is a crucial means to that end.
That is why the Bank of Canada and the Government of Canada have agreed to an explicit target for inflation control, which currently aims to hold inflation inside a range of 1 to 3%. There are already signs that this commitment is paying off in helping to reduce the fluctuations in our economy.