First, although we expect reasonable growth to resume in the second half of the year, there are risks and uncertainties attached to this projection. These risks stem from global and, especially, U.S. developments. Although a moderation of U.S. demand was needed to sustain non-inflationary growth over the medium term, the slowing has been more abrupt than anticipated.
As we look ahead, the question is how quickly will the necessary adjustments in production and inventories be completed in North America. My second point is that Canada's economic fundamentals are sound—in fact, they are the best they have been in nearly 30 years. Canada continues to benefit from a climate of low, stable, and predictable inflation. Canadian governments are running budgetary surpluses.