Because of the surprisingly strong momentum of demand in Canada since mid-1999, and because of the likelihood that this could lead to inflation pressures in the future, the Bank of Canada raised interest rates four times - by a total of 1¼ percentage points - between November 1999 and May 2000. These four interest rate increases followed similar actions by the US central bank.
The Federal Reserve’s assessment that interest rate increases were necessary because the growth of demand in that country continued to outstrip the growth of supply, was an important factor in our decision to match those moves.