The huge attention paid to the matter in the American media was perhaps a bit out of proportion. But there was a principle at stake. The reason for the US media’s strong reaction was the Great Depression and the rage felt by American taxpayers against countries not paying their debts.
This is what Canada’s monetary policy framework now provides: greater focus, greater accountability, and greater discipline. The two key elements of our current framework are (i) an explicit monetary policy goal – the 2 per cent target for inflation – and (ii) a flexible exchange rate.