It’s important for the Bank to be transparent about the signs we watch, both because financial markets should make their own judgments about what we will do and because our monetary policy works better when Canadians understand what we’re doing, and why.
The long voyage home We begin the story with the Great Recession of 2008–09, which saw Canadian exports fall further than in any recession since the Second World War. Policy-makers everywhere reacted aggressively to the global turmoil. Here in Canada, governments boosted spending, and the Bank of Canada cut interest rates in steps until we reached the effective lower bound.