July 19, 2013 Bank of Canada announces higher target for settlement balances to reinforce the target for the overnight rate Effective Monday, 22 July 2013, the Bank is increasing the target for the minimum daily level of settlement balances to $250 million, from its current level of $25 million. This measure will remain in effect until further notice. Content Type(s): Press, Market notices
August 11, 1996 Real short-term interest rates and expected inflation: Measurement and interpretation Bank of Canada Review - Summer 1996 Nicholas Ricketts This article compares different measures of real short-term interest rates for Canada over the period from 1956 to 1995. A new measure for the expected real interest rate is constructed using a proxy for inflation expectations that is based on the properties of past inflation. The history of inflation in Canada suggests that the characteristics of inflation have changed considerably over time. Past inflation can be characterized by three different types of behaviour: an environment in which average inflation is low and shocks to inflation have only temporary effects; an environment of moderate inflation with more persistent disturbances; and an environment of drifting inflation in which shocks have permanent effects on the level of inflation. The proxy for inflation expectations uses a statistical model, called a Markov Switching Model, to take account of changes in the behaviour of inflation over time. It is found that uncertainty about the changing characteristics of inflation behaviour leads to uncertainty about estimates of inflation expectations and thus about measures of real interest rates. Target ranges for keeping inflation low should help reduce the uncertainty about inflation behaviour. The behaviour of inflation and interest rates suggests that the credibility of the Bank of Canada's inflation-control objectives is growing. This should reduce inflation uncertainty and lead to lower nominal interest rates over time. Content Type(s): Publications, Bank of Canada Review articles
November 22, 2022 Financial stability in times of uncertainty Remarks Carolyn Rogers Young Canadians in Finance Ottawa, Ontario Senior Deputy Governor Carolyn Rogers discusses the Bank’s work to monitor risks and vulnerabilities in Canada’s financial system and support greater financial stability. Content Type(s): Press, Speeches and appearances, Remarks Subject(s): Financial system, Financial stability, Monetary policy, Economy/Economic growth, Inflation
January 16, 2025 The end of quantitative tightening and what comes next Remarks Toni Gravelle VersaFi (formerly Women in Capital Markets) Toronto, Ontario Deputy Governor Toni Gravelle provides an update on when quantitative tightening will end and how the Bank of Canada will manage its balance sheet after that. Content Type(s): Press, Speeches and appearances, Remarks Subject(s): Financial system, Financial markets, Financial stability, Monetary policy, Economy/Economic growth, Inflation targeting framework
The Value of Mortgage Choice: Payment Structure and Contract Length Staff working paper 2026-2 Michael Boutros, Nuno Clara, Katya Kartashova We study household mortgage choice in a model with three mortgage contracts that differ in their payment structures: fixed-rate fixed-payment, variable-rate variable-payment, and a hybrid variable-rate fixed-payment mortgage where interest rate changes affect principal repayment rather than payment size. We calibrate the model to match mortgage choice patterns in Canada, where all these options are offered with short terms. We demonstrate that restricting contract choice or mandating long terms, as in the U.S. system, can lead to substantial welfare losses by limiting risk management strategies and increasing mortgage pricing ex-ante. Content Type(s): Staff research, Staff working papers JEL Code(s): D, D1, D14, E, E2, E21, G, G1, G18, G2, G21, G5, G51 Research Theme(s): Financial system, Financial institutions and intermediation, Household and business credit
September 20, 2022 Macroeconomics of the 2020s: What we’ve learned, and what’s to come Remarks Paul Beaudry University of Waterloo Faculty of Arts Distinguished Lecture in Economics Waterloo, Ontario Deputy Governor Paul Beaudry discusses the macroeconomic lessons we’ve learned during the COVID-19 pandemic, and what lies ahead to bring inflation back to target. Content Type(s): Press, Speeches and appearances, Remarks Subject(s): Monetary policy, Economy/Economic growth, Inflation, Inflation targeting framework
April 7, 2003 Focusing on the Long Term Remarks David Dodge Canadian Council of Chief Executives Washington, D.C. It has not been an easy year. All of you have been running companies and making decisions under very uncertain conditions. You have had to deal with corporate and accounting issues. Markets have been volatile. And geopolitical events have shaken confidence. Content Type(s): Press, Speeches and appearances, Remarks
May 1, 2018 Bank of Canada policy helps manage risks from debt, Governor Poloz says Media Relations Yellowknife, Northwest Territories Elevated household debts make the Canadian economy more vulnerable to events that could affect growth and financial stability, and the Bank of Canada’s cautious approach to monetary policy is helping manage the risks, Governor Stephen S. Poloz said today. In a speech to the Yellowknife Chamber of Commerce, Governor Poloz said that high household debt […] Content Type(s): Press, Press releases