Reviewing Canada’s Monetary Policy Implementation System: Does the Evolving Environment Support Maintaining a Floor System? Staff discussion paper 2023-10 Toni Gravelle, Ron Morrow, Jonathan Witmer At the onset of the pandemic, the Bank of Canada transitioned its framework for monetary policy implementation from a corridor system to a floor system, which it has since decided to maintain. We provide a comprehensive analysis of both frameworks and assess their relative merits based on five key criteria that define a sound framework. Content Type(s): Staff research, Staff discussion papers JEL Code(s): D, D4, D47, E, E4, E42, E5, E58 Research Theme(s): Financial markets and funds management, Market structure, Monetary policy, Monetary policy tools and implementation, Money and payments, Payment and financial market infrastructures
Understanding Monetary Policy and its Effects: Evidence from Canadian Firms Using the Business Outlook Survey Staff working paper 2017-24 Matthieu Verstraete, Lena Suchanek This paper shows (i) that business sentiment, as captured by survey data, matters for monetary policy decisions in Canada, and (ii) how business perspectives are affected by monetary policy shocks. Measures of business sentiment (soft data) are shown to have systematic explanatory power for monetary policy decisions over and above typical Taylor rule variables. Content Type(s): Staff research, Staff working papers JEL Code(s): D, D2, D22, E, E4, E44, E5, E52 Research Theme(s): Monetary policy, Monetary policy framework and transmission, Monetary policy tools and implementation, Real economy and forecasting
November 20, 2018 Bank to review the monetary policy framework ahead of 2021 renewal, says Senior Deputy Governor Wilkins Media Relations Montréal, Quebec The Bank of Canada will assess a broad range of monetary policy frameworks ahead of the renewal in 2021 of the inflation-control agreement, a joint agreement between the federal government and the Bank that is renewed every five years, Senior Deputy Governor Carolyn A. Wilkins said today at McGill University’s Max Bell School of Public […] Content Type(s): Press, Press releases
April 26, 2002 The Interaction Between Monetary and Fiscal Policies Lecture David Dodge School of Policy Studies Queen's University Kingston, Ontario Donald Gow had a great interest in public administration and in budgetary reform in the federal government.1 He was one in a long line of Queen's professors who have focused on various budgetary matters at the federal level. Content Type(s): Press, Speeches and appearances, Lectures
(Un)Conventional Monetary and Fiscal Policy Staff working paper 2023-6 Jing Cynthia Wu, Yinxi Xie We build a tractable New Keynesian model to study and compare four types of monetary and fiscal policy: policy rate adjustments, quantitative easing, lump-sum fiscal transfers and government spending. We find that tax-financed fiscal policy is more stimulative than debt-financed policy, and optimal policy coordination needs at least two of these four policy instruments. Content Type(s): Staff research, Staff working papers JEL Code(s): E, E4, E6, E61, E62, E63 Research Theme(s): Monetary policy, Inflation dynamics and pressures, Monetary policy framework and transmission, Monetary policy tools and implementation, Real economy and forecasting
March 26, 2015 Financial volatility a natural consequence of monetary policy normalization, says Bank of Canada Governor Stephen S. Poloz Media Relations London, United Kingdom The recent rise in financial market volatility reflects a global economy that is beginning the process of getting back to normal, Bank of Canada Governor Stephen S. Poloz said on Thursday. In a speech to the Canada-United Kingdom Chamber of Commerce, Governor Poloz discussed the recent rise in financial market volatility and low long-term bond […] Content Type(s): Press, Press releases
What happens after Governing Council sets the policy interest rate: Inside the implementation framework that makes monetary policy work Staff analytical paper 2026-45 Kaetlynd McRae Setting the target rate is the most visible part of monetary policy, but the monetary policy implementation framework is what helps ensure that decision is reflected in financial markets. Through the design and use of its tools and facilities, the Bank of Canada helps keep short-term market interest rates close to the policy target, while preserving incentives for market participants to trade and actively manage liquidity. Content Type(s): Staff research, Staff analytical paper JEL Code(s): E, E4, E41, E42, E5, E51, E52, E58 Research Theme(s): Financial markets and funds management, Funds management, Monetary policy, Monetary policy framework and transmission, Monetary policy tools and implementation, Money and payments, Payment and financial market infrastructures
September 22, 2014 Underwhelming Recovery Poses Challenges for Monetary Policy, Says Bank of Canada Senior Deputy Governor Carolyn Wilkins Media Relations Toronto, Ontario The underwhelming recovery from the global financial crisis has challenged policy-makers to better understand the factors weighing on growth and to deal with greater uncertainty, Bank of Canada Senior Deputy Governor Carolyn Wilkins said in Toronto today. To conduct monetary policy, the Bank needs to assess how much of the slow growth is due to […] Content Type(s): Press, Press releases
May 1, 2013 Financial Crisis Taught Important Lessons About Monetary Policy, says Bank of Canada Governor Mark Carney Media Relations Edmonton, Alberta While countries around the world continue to cope with the painful aftermath of the global financial crisis, the scope and fury of events have left policy-makers with important lessons about the functioning of monetary policy and its frameworks, instruments and tactics, Bank of Canada Governor Mark Carney said today in a wide-ranging lecture about monetary […] Content Type(s): Press, Press releases
The Bank of Canada’s “Horse Race” of Alternative Monetary Policy Frameworks: Some Interim Results from Model Simulations Staff discussion paper 2021-13 José Dorich, Rhys R. Mendes, Yang Zhang Bank of Canada staff are running a “horse race” of alternative monetary policy frameworks in the lead-up to 2021 renewal of the Bank’s monetary policy framework. This paper summarizes some interim results of model simulations from their research. Content Type(s): Staff research, Staff discussion papers JEL Code(s): E, E2, E27, E3, E4, E5, E52, E58 Research Theme(s): Models and tools, Economic models, Monetary policy, Monetary policy framework and transmission