May 18, 2023
Toni Gravelle - Bank Publications
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Reviewing Canada’s Monetary Policy Implementation System: Does the Evolving Environment Support Maintaining a Floor System?
At the onset of the pandemic, the Bank of Canada transitioned its framework for monetary policy implementation from a corridor system to a floor system, which it has since decided to maintain. We provide a comprehensive analysis of both frameworks and assess their relative merits based on five key criteria that define a sound framework. -
June 9, 2022
Financial System Review—2022
The Canadian financial system remains resilient, but vulnerabilities have become more complex and risks have grown. The Bank is carefully watching households’ high levels of mortgage debt, as well as the risks associated with a price correction in Canada’s housing market. -
May 20, 2021
Financial System Review Summary—2021
The Canadian financial system proved resilient during the COVID-19 pandemic—thanks to strong risk management and unprecedented fiscal and monetary policy support. -
June 10, 2020
Our COVID-19 response: Keeping markets liquid
When the COVID-19 pandemic hit Canada, the Bank of Canada acted quickly. We needed to make sure the financial system worked well enough that credit could continue to flow. That meant addressing shortages of liquidity in financial markets—the backbone for lending and borrowing in the economy. -
May 14, 2020
Financial System Review Summary—2020
This issue of the Financial System Review focuses on the impact of COVID 19. The pandemic presents an unprecedented shock to the Canadian economy. This report identifies the effects on the Canadian financial system and explains how recent actions by the Bank and other policy-makers are helping to manage them. It further describes how a resilient financial system can help households and businesses smooth the effects of the COVID-19 shock and prepare for a robust recovery. -
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What Matters in Determining Capital Surcharges for Systemically Important Financial Institutions?
One way of internalizing the externalities that each individual bank imposes on the rest of the financial system is to impose capital surcharges on them in line with their systemic importance. -
Measuring Systemic Importance of Financial Institutions: An Extreme Value Theory Approach
In this paper, we define a financial institution’s contribution to financial systemic risk as the increase in financial systemic risk conditional on the crash of the financial institution. The higher the contribution is, the more systemically important is the institution for the system. -