Recent economic and financial developments

• Assessing the effects of higher immigration on the Canadian economy and inflation

  Staff Analytical Note 2023-17 Julien Champagne, Erik Ens, Xing Guo, Olena Kostyshyna, Alexander Lam, Corinne Luu, Sarah Miller, Patrick Sabourin, Joshua Slive, Temel Taskin, Jaime Trujillo, Shu Lin Wee

  We assess the complex macroeconomic implications of Canada’s recent population increases. We find that newcomers significantly boost the non-inflationary, potential growth of the economy, but existing imbalances in the housing sector may be exacerbated. Greater housing supply is needed to complement the long-term economic benefits of population growth.

  Content Type(s): Staff research, Staff analytical notes Topic(s): Domestic demand and components, Housing, Inflation and prices, Labour markets, Potential output, Recent economic and financial developments JEL Code(s): A, A1, A10, E, E2, E20, E3, E31, J, J1, J11, J15
• December 7, 2023

  Economic progress report: Immigration, housing and the outlook for inflation

  Remarks Toni Gravelle Windsor–Essex Regional Chamber of Commerce Windsor, Ontario

  Deputy Governor Toni Gravelle discusses the latest interest rate decision along with how immigration helps Canada’s economy and how it impacts inflation.

  Content Type(s): Press, Speeches and appearances, Remarks Topic(s): Domestic demand and components, Housing, Inflation and prices, Interest rates, Labour markets, Monetary policy, Potential output, Price stability, Recent economic and financial developments
• December 7, 2023

  What population growth means for the economy and inflation

  Speech summary Toni Gravelle Windsor-Essex Regional Chamber of Commerce Windsor, Ontario

  Speaking a day after we decided to hold interest rates steady at 5%, Deputy Governor Toni Gravelle discusses immigration, inflation and the role that newcomers play in helping our economy grow.

  Content Type(s): Press, Speeches and appearances, Speech summaries Topic(s): Domestic demand and components, Housing, Inflation and prices, Interest rates, Labour markets, Monetary policy, Potential output, Price stability, Recent economic and financial developments
• November 9, 2023

  Getting used to higher interest rates

  Speech summary Carolyn Rogers Advocis Vancouver Vancouver, British Columbia

  Senior Deputy Governor Carolyn Rogers talks about why interest rates could settle at a higher level than Canadians are used to and why preparing early for that possible outcome is important.

  Content Type(s): Press, Speeches and appearances, Speech summaries Topic(s): Credit risk management, Financial institutions, Financial markets, Financial stability, Firm dynamics, Interest rates, Monetary and financial indicators, Recent economic and financial developments
• November 9, 2023

  Financial stability in a world of higher interest rates

  Remarks Carolyn Rogers Advocis Vancouver Vancouver, British Columbia

  Senior Deputy Governor Carolyn Rogers talks about financial stability in an era of higher interest rates.

  Content Type(s): Press, Speeches and appearances, Remarks Topic(s): Credit risk management, Financial institutions, Financial markets, Financial stability, Firm dynamics, Interest rates, Monetary and financial indicators, Recent economic and financial developments

• Tattle-tails: Gauging downside risks using option prices

  Staff Analytical Note 2023-13 Greg Adams, Maksym Tupis

  Options markets offer unique insights into the changing risks different assets face, which helps us better understand the broader risks to the Canadian economy. We show how option prices help reveal that investors did not anticipate large downside risks to either major Canadian banks or economic growth during the March 2023 financial sector system stress, a period when policy-makers and investors were unsure of what the future held for Canada’s economy.

  Content Type(s): Staff research, Staff analytical notes Topic(s): Financial markets, Monetary policy and uncertainty, Recent economic and financial developments JEL Code(s): E, E4, E44, E5, E52
• September 7, 2023

  Staying the course

  Speech summary Tiff Macklem Calgary Chamber of Commerce Calgary, Alberta

  Speaking a day after we decided to maintain the policy interest rate at 5%, Governor Tiff Macklem explores some key factors behind the decision. He also explains why the 2% inflation target supports a stable economy and greater prosperity for households and businesses.

  Content Type(s): Press, Speeches and appearances, Speech summaries Topic(s): Credibility, Domestic demand and components, Expectations, Firm dynamics, Inflation and prices, Inflation targets, Inflation: costs and benefits, Labour markets, Monetary policy, Monetary policy framework, Monetary policy transmission, Price stability, Recent economic and financial developments
• September 7, 2023

  Economic progress report: Target in sight, but we’re not there yet

  Remarks Tiff Macklem Calgary Chamber of Commerce Calgary, Alberta

  Bank of Canada Governor Tiff Macklem talks about the Bank’s latest interest rate announcement and what’s happening with inflation beyond the headline numbers. He also discusses why the Bank’s 2% inflation target is the right one.

  Content Type(s): Press, Speeches and appearances, Remarks Topic(s): Credibility, Domestic demand and components, Expectations, Firm dynamics, Inflation and prices, Inflation targets, Inflation: costs and benefits, Labour markets, Monetary policy, Monetary policy framework, Monetary policy transmission, Price stability, Recent economic and financial developments
• June 8, 2023

  Economic progress report: Are we entering a new era of higher interest rates?

  Remarks Paul Beaudry Greater Victoria Chamber of Commerce Victoria, British Columbia

  Deputy Governor Paul Beaudry discusses the latest interest rate decision and suggests reasons why longer-term interest rates could remain higher than they were before the pandemic.

  Content Type(s): Press, Speeches and appearances, Remarks Topic(s): Central bank research, Coronavirus disease (COVID-19), Domestic demand and components, Expectations, Housing, Inflation and prices, Inflation targets, Interest rates, Labour markets, Monetary policy, Monetary policy transmission, Price stability, Recent economic and financial developments, Service sector
• June 8, 2023

  Adjusting to higher interest rates

  Speech summary Paul Beaudry Greater Victoria Chamber of Commerce Victoria, British Columbia

  Speaking a day after we raised interest rates, Deputy Governor Paul Beaudry talks about what Governing Council considered in its decision. He also suggests reasons why long-term interest rates could remain higher than they were before the COVID-19 pandemic.

  Content Type(s): Press, Speeches and appearances, Speech summaries Topic(s): Central bank research, Coronavirus disease (COVID-19), Domestic demand and components, Expectations, Housing, Inflation and prices, Inflation targets, Interest rates, Labour markets, Monetary policy, Monetary policy transmission, Price stability, Recent economic and financial developments, Service sector