In short, the Canadian economy last year was in a stronger position than we previously believed—operating close to capacity with inflation near target. Much of Governing Council’s deliberations focused on how persistent this recent slowdown in the domestic economy might be.
This work was borne out of necessity. Beginning in 2001, counterfeiting in Canada increased dramatically, to levels that were very high by Canadian and international standards. By 2004, counterfeiting was at a historic peak of 470 counterfeit notes detected per one million notes in circulation.