E5 - Monetary Policy, Central Banking, and the Supply of Money and Credit

• Survey-Based Estimates of the Term Structure of Expected U.S. Inflation

  Staff Working Paper 2006-46 Sharon Kozicki, P. A. Tinsley

  Surveys provide direct information on expectations, but only short histories are available at quarterly frequencies or for long-horizon expectations.

  Content Type(s): Staff research, Staff working papers Topic(s): Inflation and prices, Inflation targets, Monetary policy and uncertainty JEL Code(s): E, E3, E5

• ToTEM: The Bank of Canada's New Quarterly Projection Model

  Technical Report No. 97 Stephen Murchison, Andrew Rennison

  The authors provide a detailed technical description of the Terms-of-Trade Economic Model (ToTEM), which replaced the Quarterly Projection Model (QPM) in December 2005 as the Bank's principal projection and policy-analysis model for the Canadian economy.

  Content Type(s): Staff research, Technical reports Topic(s): Business fluctuations and cycles, Economic models JEL Code(s): E, E1, E17, E2, E20, E3, E30, E4, E40, E5, E50, F, F4, F41

• An Optimized Monetary Policy Rule for ToTEM

  Staff Working Paper 2006-41 Jean-Philippe Cayen, Amy Corbett, Patrick Perrier

  The authors propose a monetary policy rule for the Terms-of-Trade Economic Model (ToTEM), the Bank of Canada's new projection and policy-analysis model for the Canadian economy.

  Content Type(s): Staff research, Staff working papers Topic(s): Economic models, Monetary policy framework, Monetary policy transmission JEL Code(s): E, E5, E52

• Short-Run and Long-Run Causality between Monetary Policy Variables and Stock Prices

  Staff Working Paper 2006-39 Jean-Marie Dufour, David Tessier

  The authors examine simultaneously the causal links connecting monetary policy variables, real activity, and stock returns.

  Content Type(s): Staff research, Staff working papers Topic(s): Monetary and financial indicators JEL Code(s): C, C1, C12, C15, C3, C32, C5, C51, C53, E, E5, E52

• LVTS, the Overnight Market, and Monetary Policy

  Staff Working Paper 2006-15 Nadja Kamhi

  Operational events in the Large Value Transfer System (LVTS) almost always result in a disturbance of the regular flow of payments.

  Content Type(s): Staff research, Staff working papers Topic(s): Monetary policy implementation, Payment clearing and settlement systems JEL Code(s): E, E5

• Guarding Against Large Policy Errors under Model Uncertainty

  Staff Working Paper 2006-13 Gino Cateau

  How can policy-makers avoid large policy errors when they are uncertain about the true model of the economy?

  Content Type(s): Staff research, Staff working papers Topic(s): Monetary policy and uncertainty JEL Code(s): D, D8, D81, E, E5, E58

• The Welfare Implications of Inflation versus Price-Level Targeting in a Two-Sector, Small Open Economy

  Staff Working Paper 2006-12 Eva Ortega, Nooman Rebei

  The authors analyze the welfare implications of simple monetary policy rules in the context of an estimated model of a small open economy for Canada with traded and non-traded goods, and with sticky prices and wages.

  Content Type(s): Staff research, Staff working papers Topic(s): Economic models, Exchange rates, Inflation targets JEL Code(s): E, E3, E31, E32, E5, E52

• The Federal Reserve's Dual Mandate: A Time-Varying Monetary Policy Priority Index for the United States

  Staff Working Paper 2006-11 René Lalonde, Nicolas Parent

  In the United States, the Federal Reserve has a dual mandate of promoting stable inflation and maximum employment. Since the Fed directly controls only one instrument - the federal funds rate - the authors argue that the Fed's priorities continuously alternate between inflation and economic activity.

  Content Type(s): Staff research, Staff working papers Topic(s): Econometric and statistical methods, Monetary policy framework, Monetary policy implementation JEL Code(s): C, C2, C22, C5, C52, E, E5, E52

• Regime Shifts in the Indicator Properties of Narrow Money in Canada

  Staff Working Paper 2006-6 Tracy Chan, Ramdane Djoudad, Jackson Loi

  Financial innovations and the removal of the reserve requirements in the early 1990s have made the distinction between demand and notice deposits arbitrary.

  Content Type(s): Staff research, Staff working papers Topic(s): Monetary aggregates JEL Code(s): E, E4, E40, E42, E5, E50

• Are Currency Crises Low-State Equilibria? An Empirical, Three-Interest-Rate Model

  Staff Working Paper 2006-5 Christopher Cornell, Raphael Solomon

  Suppose that the dynamics of the macroeconomy were given by (partly) random fluctuations between two equilibria: "good" and "bad."

  Content Type(s): Staff research, Staff working papers Topic(s): Monetary policy and uncertainty JEL Code(s): C, C6, C62, E, E5, E59, F, F4, F41