Finance committee  That's a very good question. First of all, we have to attend meetings such as this one, and discuss these points with Members of Parliament and Canadians. That is one of the responsibilities of the Governor of the Bank of Canada. His job, in a sense, is to explain to Canadians what our inflation control framework is all about.

Finance committee  There are several points to be made here. First of all, the Bank of Canada always has to consider such issues or eventualities. There is one fundamental point in that regard, however, and it is that our economy is highly diversified. You cannot just say that we have an energy sector, a forestry sector and that's all there is.

Finance committee  Terms such as “talking the currency up and down” or “verbal intervention” are not terms we use at the Bank of Canada—I'll make that clear—again keeping to the framework. You asked about intervention. As you know, and other members would be aware, the bank has not intervened in the exchange rate market—in the exchange rate market for the Canada dollar, to be more precise—since 1998, since the Asian crisis.

Finance committee  It's a big question, so I welcome it being asked again. Very quickly, I agree with the point, and I would love to go through the reasons why I agree with the point, but in the interests of time, I'll pass to the chair.

Finance committee  Thank you for that question. If I understood you correctly, you are talking, in a way, about a two-tiered economy—a manufacturing economy, on the one hand, and an energy economy, on the other. It is absolutely fundamental that the Bank of Canada manage monetary policy for the Canadian economy as a whole.

Finance committee  Thank you very much for the question. It's extremely important, and obviously extremely timely. Certainly, we have seen substantial volatility in exchange rate markets recently, including that for the Canadian dollar. It's important to remember, as you know, that exchange rate markets, like all asset markets, can be volatile and can overshoot, and certainly the volatility we have seen in the Canadian dollar cannot be accounted for purely by changes in fundamentals.

Finance committee  Thank you very much, Chair, and I do look forward to discussion of substantive issues. I would like to begin by saying how pleased I am to be before this committee today to discuss my perspectives on the medium-term policy challenges facing the Bank of Canada. I am looking forward to many future appearances before this committee and its counterpart in the Senate, since a critical component of the bank's accountability to Canadians is having the governor appear periodically before parliamentarians to explain the bank's views on the economy, monetary policy, and the financial system.