As the Governor noted in a speech a couple of weeks ago, we cannot be sure how long the current boom in the terms of trade will last. However, given that it is being driven by structural changes in the global economy, it is likely that commodity prices will be above their average over recent decades for some time yet.
Provides useable guidance about the magnitude of the policy adjustment that may be necessary. In a paper on fiscal sustainability that my colleagues Anton Belgrave, Jason LaCorbiniere, Denisa Applewhaite and I will present at this conference, we provide an example economic analysis which we believe is practical in this sense. In the panel discussion tomorrow I hope we can explore this question more fully.