John Nelmes - Latest - Bank of Canada
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Bank of Canada RSS Feedsen2024-03-28T20:04:08+00:00Inflation expectations and Real Return Bonds
https://www.bankofcanada.ca/wp-content/uploads/2010/06/r963b.pdf
The existence of a market for Real Return Bonds in Canada provides a direct tool with which to measure market expectations of inflation by comparing the yields on these bonds with those on conventional Government of Canada long-term bonds. However, there are other factors besides inflation expectations that may affect the yield differential. After reviewing these factors, the authors note that they can lead to a potentially large bias in the level of inflation expectations.
The changes in the differential over time may, nonetheless, be a good indicator of movements in long-run inflation expectations. Based on this measure, expectations of long-run inflation have declined since late 1994.1996-08-10T09:37:57+00:00enInflation expectations and Real Return Bonds1996-08-10