The autumn Business Outlook Survey shows that firms’ expectations continue to diverge as they gradually adjust to an environment of weaker commodity prices and a lower Canadian dollar. The overall sales and investment outlook improved, owing in part to continued support from U.S. demand. However, business sentiment remains weak for firms directly and indirectly tied to the resource sector.
Bank of Canada research done prior to the most recent renewal of the inflation-control agreement in 2011 concluded that the benefits associated with a target below 2 per cent were insufficient to justify the increased risk of being constrained by the zero lower bound (ZLB) on nominal interest rates.
The Bank conducts overnight repo (OR) operations to ensure the effective implementation of our monetary policy framework. These operations inject liquidity intraday, reinforcing the Bank’s target for the overnight rate.
The Bank conducts overnight reverse repo (ORR) operations to ensure the effective implementation of our monetary policy framework. These operations withdraw liquidity intraday, reinforcing the Bank’s target for the overnight rate.
The Bank announces changes to its framework for financial market operations and emergency lending assistance policies and provides summaries of its public consultations.
As announced today, the Bank of Canada is introducing 1- and 3-month Term Repo operations that will be built up to a target portfolio size of $7 billion to $10 billion over a 6 month implementation period. Below is the preliminary schedule and amounts for the October to December quarter.
For transactions outstanding against securities purchased or sold under a term purchase and resale agreement, the Bank values the securities daily, and compares that value to the contract valuation to ensure the Bank is adequately protected.