Uncategorized

• September 28, 2018

  Bank of Canada launches The Economy, Plain and Simple

  Media Relations Ottawa, Ontario

  Today, the Bank of Canada launched a new digital publication to help Canadians better understand the economy.

  Content Type(s): Press, Press releases
• September 27, 2018

  Canada is seizing opportunities from new digital technology, Governor Poloz says

  Media Relations Moncton, New Brunswick

  Canadians are seizing the opportunities provided by the spread of digital technology, Governor Stephen S. Poloz said in a speech today. While people working in disrupted industries need help in order to adapt, the overall benefits of new technology are beyond question, he said.

  Content Type(s): Press, Press releases
• September 27, 2018

  Technological Disruption and Opportunity

  Remarks Stephen S. Poloz Atlantic Provinces Economics Council and Greater Moncton Chamber of Commerce Moncton, New Brunswick

  Governor Poloz talks about how new digital technologies create opportunities in the economy and affect how the Bank conducts monetary policy.

  Content Type(s): Press, Speeches and appearances, Remarks Research Topic(s): Domestic demand and components, Inflation and prices, Labour markets, Monetary policy, Potential output, Productivity

• Monetary Policy Uncertainty: A Tale of Two Tails

  Staff Working Paper 2018-50 Tatjana Dahlhaus, Tatevik Sekhposyan

  We document a strong asymmetry in the evolution of federal funds rate expectations and map this observed asymmetry into measures of monetary policy uncertainty. We show that periods of monetary policy tightening and easing are distinctly related to downside (policy rate is higher than expected) and upside (policy rate is lower than expected) uncertainty.

  Content Type(s): Staff research, Staff working papers Research Topic(s): Business fluctuations and cycles, Econometric and statistical methods, Monetary policy and uncertainty, Monetary policy communications, Monetary policy transmission JEL Code(s): C, C1, C18, C3, C32, E, E0, E02, E4, E43, E5, E52
• September 25, 2018

  Debt Management Strategy Consultations – 2019-20

  The Department of Finance and the Bank of Canada are seeking the views of government securities distributors, institutional investors, and other interested parties on issues related to the design and operation of the Government of Canada’s domestic debt program for 2019–20 and beyond.

  Content Type(s): Press, Market notices

• Have Liquidity and Trading Activity in the Canadian Corporate Bond Market Deteriorated?

  Staff Analytical Note 2018-31 Chen Fan, Sermin Gungor, Guillaume Nolin, Jun Yang

  Since 2010, the liquidity of corporate bonds has improved on average, while their trading activity has remained stable. We find that the liquidity and trading activity of riskier bonds or bonds issued by firms in different sectors have been stable. However, the liquidity and trading activity of bonds issued by banks have improved. We observe short-lived episodes of deterioration in liquidity and trading activity.

  Content Type(s): Staff research, Staff analytical notes Research Topic(s): Financial markets JEL Code(s): G, G1, G12, G14

• Financial Development Beyond the Formal Financial Market

  Staff Working Paper 2018-49 Lin Shao

  This paper studies the effects of financial development, taking into account both formal and informal financing. Using cross-country firm-level data, we document that informal financing is utilized more by rich countries than poor countries.

  Content Type(s): Staff research, Staff working papers Research Topic(s): Financial markets, Firm dynamics, Productivity JEL Code(s): E, E4, E44, O, O1, O17, O4, O47

• Government of Canada Fixed-Income Market Ecology

  Staff Discussion Paper 2018-10 Léanne Berger-Soucy, Corey Garriott, André Usche

  This discussion paper is the third in the Financial Markets Department’s series on the structure of Canadian financial markets. These papers are called “ecologies” because they study the interactions among market participants, infrastructures, regulations and the terms of the traded contract itself.

  Content Type(s): Staff research, Staff discussion papers Research Topic(s): Debt management, Financial institutions, Financial markets, Financial services JEL Code(s): G, G1, G10, G2, G20, H, H6, H63

• Have Liquidity and Trading Activity in the Canadian Provincial Bond Market Deteriorated?

  Staff Analytical Note 2018-30 Chen Fan, Sermin Gungor, Guillaume Nolin, Jun Yang

  In recent years, the liquidity in the secondary market for Canadian provincial bonds was a concern for many market participants. We find that a proxy for the bid-ask spread has deteriorated modestly since 2010. However, a proxy for price impact as well as measures of trade size, the number of trades and turnover have been stable or improved since 2010. This holds for bonds issued by different provinces and for bonds of different ages and sizes. Alberta bonds provide an interesting case study: After the fall in oil prices in 2014–15, the province increased its borrowing in the bond market and its credit rating was downgraded. Yet trading activity for Alberta bonds increased significantly. Overall, we interpret the evidence as a sign of resilience in the provincial bond market.

  Content Type(s): Staff research, Staff analytical notes Research Topic(s): Financial markets JEL Code(s): G, G1, G12, G14

• Should Bank Capital Regulation Be Risk Sensitive?

  Staff Working Paper 2018-48 Toni Ahnert, James Chapman, Carolyn A. Wilkins

  We present a simple model to study the risk sensitivity of capital regulation. A banker funds investment with uninsured deposits and costly capital, where capital resolves a moral hazard problem in the banker’s choice of risk.

  Content Type(s): Staff research, Staff working papers Research Topic(s): Financial institutions, Financial system regulation and policies JEL Code(s): G, G2, G21, G28