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The author introduces a central counterparty (CCP) into a model of a repo market. Without the CCP, there exist multiple equilibria in the model. In one of the equilibria, a repo market emerges as bond dealers and cash investors choose to arrange repos in an over-the-counter bond market.
: Financial markets; Financial stability; Payment, clearing, and settlement systemsRising levels of household indebtedness have created concerns about the vulnerabilities of households to adverse economic shocks and the impact on financial stability. To assess these risks, the author presents a formal stress-testing framework that uses microdata to simulate how various economic shocks affect the distribution of the debt-service ratio (DSR) for the household sector.
: Econometric and statistical methods; Financial stabilityThe authors present key insights from the Bank of Canada’s 2009 Methods-of-Payment survey. In the survey, about 6,800 participants completed a questionnaire with detailed information regarding their personal finances, as well as their use and perceptions of different payment methods.
: Bank notes; Financial servicesThe author constructs a measure of foreign activity that takes into account the composition of foreign demand for Canadian exports. It has a number of interesting features.
: Balance of payments and components; Exchange rates; Recent economic and financial developments![[+]](http://www.bankofcanada.ca/wp-content/plugins/collapsing-archives-boc-fork/img/expand.png)