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1010
result(s)
Unintended Consequences of the Home Affordable Refinance Program
Staff Working Paper 2024-11
Phoebe Tian,
Chen Zheng
We investigate the unintended consequences of the Home Affordable Refinance Program (HARP). Originally designed to help borrowers refinance after the 2008–09 global financial crisis, HARP inadvertently strengthened the market power of incumbent lenders by creating a cost advantage for them. Despite a 2013 policy rectifying this cost advantage, we still find significant welfare losses for borrowers.
Content Type(s):
Staff research,
Staff working papers
Topic(s):
Financial institutions
JEL Code(s):
G,
G2,
G21,
G5,
G51,
L,
L5,
L51
Measuring household financial stress in Canada using consumer surveys
Staff Analytical Note 2024-5
Nicolas Bédard,
Patrick Sabourin
We use data from the Canadian Survey of Consumer Expectations to understand how households are coping with high inflation and high interest rates. We build a subjective measure of financial stress and find that the level of stress is at a historical high but remains manageable for most households.
Content Type(s):
Staff research,
Staff analytical notes
Topic(s):
Domestic demand and components,
Financial stability,
Monetary policy transmission,
Recent economic and financial developments
JEL Code(s):
D,
D1,
D14,
G,
G5,
H,
H3
Monetary Policy Transmission Through Shadow and Traditional Banks
Staff Working Paper 2024-8
Amina Enkhbold
I investigate how monetary policy transmits to mortgage rates via the mortgage market concentration channel for both traditional and shadow banks in the United States from 2009 to 2019. On average, shadow and traditional banks exhibit only a slight disparity in transmitting monetary shocks to mortgage rates.
Content Type(s):
Staff research,
Staff working papers
Topic(s):
Financial institutions,
Interest rates,
Monetary policy transmission
JEL Code(s):
E,
E4,
E44,
E5,
E52,
G,
G2,
G21
What has been putting upward pressure on CORRA?
Staff Analytical Note 2024-4
Boran Plong,
Neil Maru
From the autumn of 2023 into early 2024, the Canadian Overnight Repo Rate Average (CORRA), a measure of the cost of overnight general collateral Canadian dollar repos, was consistently well above the Bank’s target for the overnight rate. We find that, among several factors, long bond positions that require repo financing are the main driver of the recent upward pressure on CORRA.
Content Type(s):
Staff research,
Staff analytical notes
Topic(s):
Financial markets,
Interest rates,
Lender of last resort,
Monetary policy implementation
JEL Code(s):
D,
D4,
D5,
D53,
E,
E4,
E43,
E44,
E5,
E52,
G,
G1,
G12
Decomposing Large Banks’ Systemic Trading Losses
Staff Working Paper 2024-6
Radoslav Raykov
Do banks realize simultaneous trading losses because they invest in the same assets, or because different assets are subject to the same macro shocks? This paper decomposes the comovements of bank trading losses into two orthogonal channels: portfolio overlap and common shocks.
Content Type(s):
Staff research,
Staff working papers
Topic(s):
Financial institutions,
Financial stability
JEL Code(s):
G,
G1,
G10,
G11,
G2,
G20
The Role of International Financial Integration in Monetary Policy Transmission
Staff Working Paper 2024-3
Jing Cynthia Wu,
Yinxi Xie,
Ji Zhang
We propose an open-economy New Keynesian model with financial integration that allows financial intermediaries to hold foreign long-term bonds. We study the implications of financial integration on monetary policy transmission. Among various aspects of financial integration, the bond duration plays a major role. These results hold for conventional and unconventional monetary policies.
Content Type(s):
Staff research,
Staff working papers
Topic(s):
Central bank research,
International financial markets,
Monetary policy transmission
JEL Code(s):
E,
E4,
E44,
E5,
E52,
F,
F3,
F36,
F4,
F42
The Role of Long-Term Contracting in Business Lending
Staff Working Paper 2024-2
Phoebe Tian
This paper examines inefficiencies arising from a lack of long-term contracting in small business lending in China.
Content Type(s):
Staff research,
Staff working papers
Topic(s):
Financial institutions
JEL Code(s):
D,
D8,
D83,
D86,
G,
G2,
G21,
L,
L1,
L14,
L2,
L26
Market structure of cryptoasset exchanges: Introduction, challenges and emerging trends
Staff Analytical Note 2024-2
Vladimir Skavysh,
Jacob Sharples,
Sofia Priazhkina,
Salman H. Hasham
This paper provides an overview of cryptoasset exchanges. We contrast their design with exchanges in traditional financial markets and discuss emerging regulatory trends and innovations aimed at solving the problems cryptoasset exchanges face.
Content Type(s):
Staff research,
Staff analytical notes
Topic(s):
Digital currencies and fintech,
Payment clearing and settlement systems
JEL Code(s):
G,
G1,
G15,
L,
L1
2022 Methods-of-Payment Survey Report: Cash Use Over 13 Years
Staff Discussion Paper 2024-1
Christopher Henry,
Doina Rusu,
Matthew Shimoda
We present results from the 2022 Methods-of-Payment Survey, including updated payment shares based on a three-day shopping diary. We also assess various factors associated with long-term trends in cash use.
Content Type(s):
Staff research,
Staff discussion papers
Topic(s):
Bank notes,
Coronavirus disease (COVID-19),
Digital currencies and fintech,
Financial services
JEL Code(s):
D,
D8,
D83,
E,
E4,
E41