I'll say a few words with respect to the dynamics.
In our July monetary policy report, we were already expecting a fairly weak second quarter, partly as a result of the supply chain effects relating to the earthquake and subsequent disasters in Japan. Also, looking back to the first part of the year, the fairly rapid run-up in gasoline prices was affecting people's budgets.
At the time, we expected the second quarter to come in at 1.5%. As the Governor indicated in his opening statement, given subsequent data, we are expecting the second quarter to be roughly flat, and possibly slightly negative. We continue to expect a recovery in the second half of the year, partly as the supply chain effects come back and partly because we do continue to see growth in the United States, although modest.
However, as indicated in the opening statement, we are seeing somewhat weaker economic momentum globally. That will no doubt affect Canada and, as the Governor indicated, we will be looking at all the incoming data and updating our projections. We have our next monetary policy decision in early September and our next full forecast in our monetary policy report in October.