With unemployment at a 33-year low, it's clear that Canada has been going through this difficult process of adjustment with considerable success. Our job at the Bank of Canada is to continue to aim for 2 per cent inflation so that when some prices change, these are clearly relative price changes, and longerrun inflation expectations remain anchored at the 2 per cent target.
As a result, the growth of nonfinancial corporate debt in the past two-and-a-half years was limited to its slowest pace since the early 1990s. These repairs to balance sheets have also reduced the exposure of many firms to rising interest rates, especially in the near term.