 | |  | | [13:11 Bank of Canada: Longworth Address - Concerns with the dollar] Boston,
January 9, 2004. Deputy Governor of the Bank of Canada is speaking on the
subject of ''The interaction between monetary and financial stability policies''
to the Economic Club of Toronto this morning. The speech just released on the
Bank's website sticks to the same issues pointed out by Governor Dodge in his
recent statement. Not too much to report from this address. Longworth continues
to point to the dollar and the level of accommodation in the system to support
the economy. Growth is somewhat disappointing to the Bank in that it appears to
be ''at close to 4 per cent.''
'' While many of the elements of the outlook for demand growth, both abroad and
at home, remain favourable for 2004, there are two key issues that continue to
confront us as we look to setting monetary policy going forward: first, the
extent to which the sharp appreciation of the Canadian dollar will offset the
effects of strong world demand for Canadian goods and services; second, given
the net effect of these two factors, whether the amount of monetary stimulus
currently in the economy will support an increase in business investment and
household spending that is sufficiently large to close the output gap consistent
with returning inflation to our 2 per cent target by mid-2005.''
While Longworth may have seen the employment data this morning, there is no
doubt that the Bank's concerns have been at least temporarily postponed. When
you factor in the robustness of the employment picture in the past four mos,
together with the results of the recent Christmas retail selling season, the
economy continues to give very optimistic signs for the future, helping to ease
the concerns over the impact of the currency. -David.Ebata@thomson.com |  |  |  |  |
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发表于 2004-1-9 21:08
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