Vadym Lepetyuk is a Principal Researcher in the Canadian Economic Analysis Department at the Bank of Canada. Vadym’s work has focused mainly on macroeconomic modelling and policy analysis. He received his Ph.D. in economics from the University of Minnesota.
We use the Terms-of-Trade Economic Model (ToTEM) to conduct demand- and supply-driven simulations, both of which deliver weakness in Canadian non-commodity exports relative to foreign activity in line with recent data.
Recent international experience with the effective lower bound on nominal interest rates has rekindled interest in the benefits of inflation targets above 2 per cent. We evaluate whether an increase in the inflation target to 3 or 4 per cent could improve macroeconomic stability in the Canadian economy.