But to place our recent experience in some context, I should go back a bit further than that - to the 11 September 2001 terrorist attacks in the United States. In the wake of that terrible event, the Bank of Canada quickly and aggressively cut its policy interest rate to shore up confidence and support domestic demand.
This action, together with earlier reductions in our policy interest rate, meant that the Bank had injected considerable stimulus into the economy. By the spring of 2002, evidence had already started to build that demand was recovering more quickly than had been anticipated. So, even though demand pressures were not yet showing up in prices, we began to remove some of that monetary stimulus.