Thank you, Mr. Chairman.
Welcome, Governor and Senior Deputy Governor.
I am going to ask my three questions all at once and then hopefully you can respond in the same order.
I will begin by saying that I would like to acknowledge the arm's length nature of the governor and the Bank of Canada in terms of monetary policy. However, several questions came to mind when I read your remarks to the finance committee of the British Parliament. I will ask you one of those questions.
You suggested the possibility of using a nominal GDP target rather than an inflation target such as the one we now have. I was a little perplexed by that comment, given the Bank of Canada's current situation. I would like to hear your comments on that and give you an opportunity to give us your perspective.
Furthermore, the Bank of Canada recently noted that Canadian exports have decreased in part because of competitive issues, including the continued strength of the Canadian dollar. Given that the federal government has very little power over the exchange rate, could you tell me if in your opinion multifactor productivity growth should be a priority for the federal government, and if a long-term stable plan for infrastructure investment could be a way of counteracting that weakness in productivity?
Last, the vice-chair of the United States Federal Reserve, the FED, gave a presentation yesterday and said the following. I will read the quote in English.
“Both for the United States and for Europe...fiscal austerity does raise unemployment, weaken the economy and...in addition undermines the goals it is designed to achieve”....
The direction that the Canadian government has taken has focused on austerity even though the extent differs from that of the United States. I would like to hear your comments on the statement made by the vice-chair of the FED and what its implications could be from a Canadian perspective.