It was a read-my-lips moment for Stephen Poloz.
Barely a year into his mandate as Bank of Canada Governor, Mr. Poloz was determined to quell speculation that he was actively talking down the Canadian dollar to revive sluggish exports.
"Trying to control the loonie is off the table," Mr. Poloz said point blank last September during a speech in Drummondville, Que.
Manipulating or trying to guide financial markets, he insisted, is not in "our game plan."
Five months and one shocker of an interest rate cut later, idle chatter about Mr. Poloz's true motives has become, well, common currency.
"The Bank of Canada rate cut … was 100 per cent about easing policy via the currency," David Rosenberg, chief economist and strategist at Gluskin Scheff, said in a daily market commentary this week.
It's all about the bank "recalibrating the currency" to keep manufacturers in Central Canada competitive with their U.S. rivals, while offsetting plunging investments in the oil patch, Mr. Rosenberg added.
The risk for the central bank is that perception becomes reality, condemning Mr. Poloz to be the Governor of the Bank of Misunderstood.
On the one hand, there is the Bank of Canada's well-established monetary policy goal of keeping inflation low and stable.
Then, there is the stated reason for last month's very unexpected rate cut – "insurance" against the negative effects of the oil price collapse, including disinflation, plunging oil patch investments and a possible housing correction.
And, finally, there is the unspoken motive, cited by Mr. Rosenberg and many others, of making exporters more competitive via a cheaper dollar.
The more Mr. Poloz protests, the more convinced many people are that targeting the dollar is exactly what the Bank of Canada is doing.
"There is the argument you make in public and there is the argument you make in private," explained Mark Hopkins, chief Canadian economist at Moody's Analytics. "And I think the argument you make in private has a lot to do with competitiveness and trying to boost exports."
So far, the bank is getting what many analysts say it wants. The dollar has lost more than 3 cents (U.S.) to hover around 80 cents since Jan. 21, when the bank lowered its key lending rate to 0.75 per cent. That's already providing benefits for non-energy exporters.
Financial markets are now betting on at least another quarter-percentage-point rate cut by the spring, with some economists predicting the central will drop the rate as low as 0.25 per cent.
Mr. Poloz will look like a maestro if lower rates accomplish his stated inflation-fighting mandate, while also boosting exports.
But the strategy could become a lot trickier if cheaper oil doesn't materially move the core rate of inflation, or if oil prices continue to rally in the coming months. Mr. Poloz may find it increasingly hard to justify why even lower rates are warranted.
"It's a bit of a dangerous game," he said. "If they start to signal additional rate cuts, what they are really thinking is that they would be happier with a still weaker currency."
Perception could wind up out sync with monetary policy.
The bank's 2-per-cent inflation target is clear. But if Mr. Poloz is also secretly targeting the dollar, how low does he want it to go?
He probably wasn't happy with a dollar at 97 cents – the level it was at when he became governor in June, 2013. And he apparently wasn't satisfied with the 84-cent level it was at in early January before the rate cut.
With financial markets bracing for the Bank of Canada to cut again, forecasters are already betting the dollar will go lower. Bank of Nova Scotia expects the dollar to fall to 75 cents by the end of this year before stabilizing at around 77 cents. Morgan Stanley is calling for the loonie to continue sliding to 71 cents by the end of 2016.
Mr. Poloz insists that he's brought more transparency to the bank's decision-making in the past year and a half by being much clearer about the risks buffeting the economy.
And yet Mr. Poloz may be more misunderstood than ever.
Should he want to clear up any misconceptions, Mr. Poloz and his top deputies have three speeches scheduled between now and the next rate announcement, set for March 4. He's also due to make an appearance on Feb. 9-10 at a Group of 20 meeting of central bankers and finance ministers in Istanbul.