Thanks in no small part to the flexibility of our policy framework, which I will discuss in greater detail in a few moments, the Federal Reserve appropriately discharged its responsibility as lender of last resort by providing ample liquidity and ensuring confidence during these and other troubling episodes, including the aftermath of the terrorist attacks of September 11, 2001.
In April of 1999 our main refinancing rate was lowered to the then unprecedented level of 2.5 per cent, when inflation was around 1 per cent and the economy was showing signs of weakness.