Further work is clearly needed to better understand the ways in which Canadian businesses and households form their expectations, as well as the communication challenges that might arise if Canada were to move to price-level targeting. If the learning curve is too long and expectations are too slow to adjust, the present value of any shift to price-level targeting could easily turn negative.
18 The Bank is currently conducting some experimental work designed to shed light on both issues, and hopes to report its preliminary findings later this year. Balancing monetary and financial stability The tension that can sometimes exist between the dual objectives of monetary and financial stability is an issue that has been brought to the fore by recent events.