Staff analytical notes are short articles that focus on topical issues relevant to the current economic and financial context.
230
result(s)
Comparing Forward Guidance and Neo-Fisherianism as Strategies for Escaping Liquidity Traps
Staff Analytical Note 2016-16
Robert Amano,
Thomas J. Carter,
Rhys R. Mendes
What path should policy-makers select for the nominal rate when faced with a liquidity trap during which the effective lower bound binds?
Content Type(s):
Staff research,
Staff analytical notes
Topic(s):
Central bank research,
Economic models,
Inflation and prices,
Interest rates,
Monetary policy framework,
Monetary policy transmission
JEL Code(s):
E,
E4,
E5
The Share of Systematic Variations in the Canadian Dollar—Part I
Staff Analytical Note 2016-15
Jean-Sébastien Fontaine,
Guillaume Nolin
In this analytical note we show that the share of the systematic variations in the Canadian dollar has risen significantly in the past two decades. Systematic variations in the exchange rate are shared with other currencies. This parallels the equity market, where variations in the price of a given stock are shared with variations in the prices of other stocks.
Content Type(s):
Staff research,
Staff analytical notes
Topic(s):
Exchange rates
JEL Code(s):
F,
F3,
F31
A Primer on Neo-Fisherian Economics
Staff Analytical Note 2016-14
Robert Amano,
Thomas J. Carter,
Rhys R. Mendes
Conventional models imply that central banks aiming to raise inflation should lower nominal rates and thus stimulate aggregate demand. However, several economists have recently challenged this conventional wisdom in favour of an alternative “neo-Fisherian’’ view under which higher nominal rates might in fact lead to higher inflation.
Content Type(s):
Staff research,
Staff analytical notes
Topic(s):
Central bank research,
Economic models,
Inflation and prices,
Interest rates,
Monetary policy framework,
Monetary policy transmission
JEL Code(s):
E,
E4,
E5
The Global Benefits of Low Oil Prices: More Than Meets the Eye
Staff Analytical Note 2016-13
Robert Fay,
Justin-Damien Guénette,
Louis Morel
Between mid-2014 and early 2016, oil prices fell by roughly 65 per cent. This note documents the channels through which this oil price decline is expected to affect the global economy. One important and immediate channel is through higher expenditures, especially in net oil-importing countries.
Content Type(s):
Staff research,
Staff analytical notes
Topic(s):
Business fluctuations and cycles,
International topics,
Recent economic and financial developments
JEL Code(s):
E,
E3,
E32,
E37,
F,
F0,
F01,
Q,
Q4,
Q43
Assessment of the Effects of Macroprudential Tightening in Canada
Staff Analytical Note 2016-12
Martin Kuncl
During the period of 2008 to 2012, the rules for government-backed mortgage insurance were tightened on four occasions. In this note, we estimate the effects through a simple econometric exercise using a vector error-correction model (VECM).
Content Type(s):
Staff research,
Staff analytical notes
Topic(s):
Credit and credit aggregates,
Financial system regulation and policies,
Housing
JEL Code(s):
C,
C3,
C32,
E,
E6,
E65,
G,
G2,
G28
Low for Longer? Why the Global Oil Market in 2014 Is Not Like 1986
Staff Analytical Note 2016-11
Bahattin Buyuksahin,
Reinhard Ellwanger,
Kun Mo,
Konrad Zmitrowicz
In the second half of 2014, oil prices experienced a sharp decline, falling more than 50 per cent between June 2014 and January 2015. A cursory glance at this oil price crash suggests similarities to developments in 1986, when the price of oil declined by more than 50 per cent, initiating an episode of relatively low oil prices that lasted for more than a decade.
Content Type(s):
Staff research,
Staff analytical notes
Topic(s):
International topics,
Recent economic and financial developments
JEL Code(s):
E,
E3,
Q,
Q4,
Q41,
Q43
The Case of Serial Disappointment
Staff Analytical Note 2016-10
Justin-Damien Guénette,
Nicholas Labelle,
Martin Leduc,
Lori Rennison
Similar to those of other forecasters, the Bank of Canada’s forecasts of global GDP growth have shown persistent negative errors over the past five years. This is in contrast to the pre-crisis period, when errors were consistently positive as global GDP surprised to the upside. All major regions have contributed to the forecast errors observed since 2011, although the United States has been the most persistent source of notable errors.
Content Type(s):
Staff research,
Staff analytical notes
Topic(s):
Business fluctuations and cycles,
Domestic demand and components,
Economic models,
International topics,
Monetary policy and uncertainty,
Potential output
JEL Code(s):
E,
E2,
E27,
E6,
E66,
F,
F0,
F01
The US Labour Market: How Much Slack Remains?
Staff Analytical Note 2016-9
Robert Fay,
James Ketcheson
Despite the US unemployment rate being close to estimates of the non-accelerating-inflation rate of unemployment (NAIRU), measures of underemployment remain elevated, which could be an indication of remaining labour market slack. The shares of involuntary part-time workers and long-term unemployment are high relative to the current stage of the business cycle, suggesting available labour inputs are being underutilized.
Content Type(s):
Staff research,
Staff analytical notes
Topic(s):
International topics,
Labour markets,
Recent economic and financial developments
JEL Code(s):
E,
E2,
E24,
J,
J2,
J21,
J23
Crude Oil Prices and Fixed-Asset Cash Spending in the Oil and Gas Industry: Findings from VAR Models
Staff Analytical Note 2016-8
Farrukh Suvankulov
This note investigates the relationship between crude oil prices and investment in the energy sector. We employ a set of vector autoregression (VAR) models (unconstrained VAR, vector error-correction and Bayesian VAR) to formalize the relationship between the West Texas Intermediate (WTI) benchmark and fixed-asset cash spending in the oil and gas extraction and support activities sector of the Canadian economy.
Content Type(s):
Staff research,
Staff analytical notes
Topic(s):
Domestic demand and components,
Econometric and statistical methods
JEL Code(s):
E,
E2,
E22,
E27,
Q,
Q4,
Q43,
Q47