•  Total CPI inflation has fallen noticeably below the 2 per cent target, as expected. It is projected to return to target by the end of 2013, somewhat later than previously anticipated. •  The inflation outlook in Canada is subject to significant risks.
The Bank’s projection assumes that authorities in Europe are able to contain the ongoing crisis, and that the U.S. fiscal cliff will be avoided. –  The three main upside risks relate to the possibility of higher global inflationary pressures, stronger Canadian exports and renewed momentum in Canadian residential investment.