Finance committee  Yes.

Finance committee  Well, the first thing I'd like to say to all Canadians is that we know that Canadians want to see inflation come down. They're tired of seeing prices go up so quickly, and we know that they'd like to see interest rates come down. So would we. When we have more assurance that those inflation pressures are easing and that inflation is clearly headed back to 2%, we can have that discussion about cutting interest rates.

Finance committee  It is ticking up, and I expect it will go up a bit more.

Finance committee  Yes, anything that has been announced by the government and that has been through the House will be built into our projections.

Finance committee  When we get the national accounts data, we do update our forecast. Therefore, when we get Q4 data, we will be updating our forecast.

Finance committee  Do you want to say a few words about that?

Finance committee  I wouldn't call it stagflation. Growth is weak. In fact, we actually need this period of weak growth to let supply catch up—

Finance committee  Stagflation is a period of high inflation—

Finance committee  —and high unemployment. We don't have high unemployment. Yes, unemployment has come up, but it was extremely low. It's back to more normal levels.

Finance committee  What I was referring to in that quote was relative to the track the government laid out previously. The fall economic statement didn't add material new spending that would add new inflationary pressures. We built the previous budget, as well as the fall economic statement, into our projection.

Finance committee  With respect to fiscal policy, we take in the budget plans of all levels of government. We build those into our forecasts. You can see those in our monetary policy report. Therefore, yes, we factored in government spending plans. This is contributing to growth in the economy, which is something we factored into our decision.

Finance committee  Well, let me talk about what we see. Let me back up for a second. As I've said many times, fiscal policy decisions are not the purview of the Bank of Canada—

Finance committee  They're made by parliamentarians. What we do is take the spending plans this government has given and build those into our outlook. If you look at spending in 2023 for all levels of government, real government spending on goods and services grew at about 2%, which is roughly in line with the growth potential, most of which is population growth.

Finance committee  I was actually getting to the “go forward” strategy. With government spending estimated to be growing by around two and a quarter per cent, it's a little above potential. We built that into our forecast. You can see how inflation comes down gradually in our forecast. That being said, it's already at the upper end of potential.

Finance committee  Thank you and good morning. I'm very pleased to be here with Senior Deputy Governor Carolyn Rogers to discuss the monetary policy report we published last week, as well as the decision we took. Last week, we maintained our policy interest rate at 5%. We are also continuing our policy of quantitative tightening.