Since the late 1990s, Canada has seen the benefits that can come from fiscal prudence. Putting our fiscal house in order has helped to establish credibility for our macroeconomic framework.
Reflecting these developments, there was deterioration in external vulnerability indicators: ratio of short term debt to total debt increased and import cover of reserves fell. Net international investment position (IIP), another indicator of sustainability of external position, deteriorated during post-crisis period (Table 4). Role of monetary policy During the high growth phase of 2003–08, inflation was low and stable.