D53 - Financial Markets - Bank of Canada
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Bank of Canada RSS Feedsen2024-03-29T05:02:12+00:00Estimating Canada’s Effective Lower Bound
https://www.bankofcanada.ca/wp-content/uploads/2016/05/boc-review-spring16-witmer.pdf
Recently, the Bank of Canada has estimated the effective lower bound (ELB) on its policy interest rate to be about -50 basis points. This article outlines the analysis that underpins that estimate by quantifying the costs of storing and using cash in Canada. It also explores how some international markets have adapted to negative interest rates, issues surrounding their implementation, as well as their transmission to other interest rates in the economy. Finally, it discusses theoretical ideas on how the ELB could be reduced further.2016-05-16T08:53:53+00:00enEstimating Canada’s Effective Lower Bound2016-05-16