Introduction
Good afternoon. It's a pleasure to be here. I want to thank the Mississauga Board of Trade and the Oakville Chamber of Commerce for inviting me.
When I accepted this invitation, months ago, I intended to use this opportunity to launch the renewal process for our monetary policy framework. The framework sets out the goal for monetary policy-to maintain price stability over time. In simple terms, we aim for a 2% inflation target, so inflation remains within a range of 1% to 3% most of the time. We renew the framework, in agreement with the Government of Canada, every five years. This is a strength of our system. It gives us the opportunity to review performance and consider whether the framework remains the best one for the future.
That was my speech topic until President Trump announced significant and broad-based tariffs on Canadian exports. While the new tariffs have not taken effect yet, the uncertainty around US trade policy is already affecting our economy. And if the United States starts a protracted trade conflict, the consequences could be severe. I know this is foremost on everyone's mind. That's why I've adjusted my remarks.
President Trump wants to use tariffs as an instrument of US policy. What that means for the global economy and for the Canada-US trade relationship is highly uncertain. We don't know what tariffs will be imposed, when they'll start, how long they'll last-or even really to what end. We also don't know how Canada and other countries will respond. And even when we know more, it will be hard to predict the economic impacts because we haven't experienced such broad-based tariffs since the 1930s.
What looks inescapable, however, is that a structural change is upon us. Increased trade friction with the United States is a new reality. While there are still more questions than answers, I will use my remarks to speak to some of the key questions:
What could this structural change look like?
