Publications

• December 14, 2009

  Financial System Review - December 2009

  

  Conditions in the international financial system have improved considerably since June in response to the forceful actions taken by policy-makers around the world.

  FSR Highlights - December 2009

  Content Type(s): Publications, Financial Stability Report
• December 3, 2009

  Improving the Resilience of Core Funding Markets

  Financial System Review - December 2009 Jean-Sébastien Fontaine, Jack Selody, Carolyn A. Wilkins

  Content Type(s): Publications, Financial System Review articles
• November 11, 2009

  Declining Inflation Persistence in Canada: Causes and Consequences

  Bank of Canada Review - Winter 2009-2010 Rhys R. Mendes, Stephen Murchison

  The persistence of both core and total consumer price index inflation in Canada has declined significantly since the 1980s. In addition to providing up-to-date estimates of inflation persistence, this article examines possible reasons for the decline suggested in the literature. The role played by monetary policy, through its effect on price- and wage-setting behaviour, is distinguished from possible changes to the structure of the economy that are independent of monetary policy. The authors also discuss the implications for monetary policy of low structural persistence in inflation, including the choice of an inflation-targeting regime versus a price-level-targeting regime.

  Content Type(s): Publications, Bank of Canada Review articles Research Topic(s): Inflation and prices, Monetary policy framework
• November 11, 2009

  The Evolution of Capital Flows to Emerging-Market Economies

  Bank of Canada Review - Winter 2009-2010 Lena Suchanek, Garima Vasishtha

  Many emerging-market economies (EMEs) have significantly improved their macroeconomic fundamentals and undergone structural reforms since the Asian crisis. These developments have enhanced the composition of capital flows to EMEs through an improved debt structure, a larger share of capital flows as foreign direct investment, and greater access to international debt markets for corporations in EMEs. Structural changes in the global financial landscape have also increased capital flows, bringing economic and financial benefits to EMEs. During the recent financial crisis, however, the opening up of capital accounts and increased financial and trade linkages left many countries vulnerable to external disruptions. Countries with sound fundamentals have weathered the crisis relatively well. Policy-makers in EMEs need to implement policies that support capital flows and ensure that controls imposed to deal with detrimental outflows during periods of stress or rapid inflows are only temporary.

  Content Type(s): Publications, Bank of Canada Review articles Research Topic(s): Development economics, Financial markets, Financial system regulation and policies
• November 11, 2009

  Making Bank Notes Accessible for Canadians Living with Blindness or Low Vision

  Bank of Canada Review - Winter 2009-2010 Carolyn Samuel

  The ability to conduct financial transactions using bank notes is crucial to independent living. Yet this can pose significant challenges for individuals who are blind or partially sighted. This article discusses the Bank of Canada's efforts over the past 30 years to meet the accessibility needs of a specific subset of the population–Canadians living with blindness or vision loss. It also reports the findings of expert and user assessments of the suite of accessibility features on the current series of bank notes and shares plans for the next series.

  Content Type(s): Publications, Bank of Canada Review articles Research Topic(s): Bank notes, Central bank research
• October 26, 2009

  Monetary Policy Report – October 2009

  

  Recent indicators point to the start of a global recovery from a deep, synchronous recession.

  Content Type(s): Publications, Monetary Policy Report
• October 25, 2009

  Senior Loan Officer Survey - Third-Quarter 2009

  By a narrow margin, the survey results point to continued tightening in credit conditions during the third quarter, following a period of substantial credit tightening for business borrowers (Chart 1).

  Content Type(s): Publications, Senior Loan Officer Survey
• October 9, 2009

  Business Outlook Survey - Autumn 2009

  Responses to the autumn survey suggest that the Canadian economy is recovering, as all indicators of business activity have increased since the summer survey. However, because firms continue to expect activity to pick up only gradually, they remain cautious regarding investment.

  Content Type(s): Publications, Business Outlook Survey
• September 11, 2009

  Bank of Canada Liquidity Actions in Response to the Financial Market Turmoil

  Bank of Canada Review - Autumn 2009 Lorie Zorn, Carolyn A. Wilkins, Walter Engert

  In response to the financial crisis of 2007-09, the Bank of Canada intervened repeatedly to stabilize the financial system and limit the repercussions of the crisis on the Canadian economy. This article reviews the extraordinary liquidity measures taken by the Bank during this period and the principles that guided the Bank's interventions. A preliminary assessment of the term liquidity facilities provided by the Bank suggests that they were an important source of liquidity support for some financial institutions and, on a broader basis, served to reduce uncertainty among market participants about the availability of liquidity, as well as helping to promote a return to well-functioning money markets.

  Content Type(s): Publications, Bank of Canada Review articles Research Topic(s): Financial institutions, Financial markets, Financial stability
• September 11, 2009

  Understanding Corporate Bond Spreads Using Credit Default Swaps

  Bank of Canada Review - Autumn 2009 Alejandro García, Jun Yang

  Corporate bond spreads worldwide have widened markedly since the beginning of the credit crisis in 2007. This article examines default and liquidity risk–the main components of the corporate bond spread–for Canadian firms that issue bonds in the U.S. market, focusing in particular on their evolution during the credit crisis. They find that, during this period, the liquidity component increased more for speculative-grade bonds than it did for investment-grade bonds, consistent with a "flight-to-quality" phenomenon. An important implication of their results for policy-makers seeking to address problems in credit markets is that the liquidity risk in corporate spreads for investment and speculative bonds behaves differently than the default risk, especially during crisis episodes.

  Content Type(s): Publications, Bank of Canada Review articles Research Topic(s): Econometric and statistical methods, Financial markets, Financial stability