If inflation is too low, we can lower our key policy interest rate and expect to stimulate demand for goods and services. When we raise interest rates, we expect to cool demand. You would expect, then, that relatively low interest rates would lead to strong demand for housing. Looking back, mortgage rates shifted into a lower range in the late 1990s.
Mark Carney: Reforming the global financial system Remarks by Mr Mark Carney, Governor of the Bank of Canada, at a Rendez-vous avec l’Autorité des marchés financiers, Montréal, Québec, 26 October 2009. *  *  *  It is a pleasure to be here at this year’s Rendez-vous avec l’Autorité des marchés financiers (AMF).