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The Statement of Policy establishes the policy governing the acquisition and management of financial assets for the Bank’s balance sheet. It does not apply to the assets of the Bank’s pension trust fund or supplementary trust fund.

Read the terms and conditions of the Contingent Term Repo Facility.

This issue of the Financial System Review focuses on the impact of COVID 19. The pandemic presents an unprecedented shock to the Canadian economy. This report identifies the effects on the Canadian financial system and explains how recent actions by the Bank and other policy-makers are helping to manage them. It further describes how a resilient financial system can help households and businesses smooth the effects of the COVID-19 shock and prepare for a robust recovery.

Although the global financial system continues to recover gradually from the unprecedented dislocations experienced in recent years, significant downside risks remain. Market concerns over acute fiscal strains in some euro-area countries have intensified sharply in recent weeks.

FSR Highlights - December 2010

The Annual Report outlines the Bank’s activities and achievements in 2017. It includes the financial statements and a message from Governor Stephen S. Poloz.

We construct a dataset on Federal Reserve and Bank of Canada non-rate announcement events to provide novel insights into how foreign and domestic monetary policy communications affect the financial markets of open economies. We find that Fed non-rate communications have a stronger impact on long-term interest rates and stock futures, while Bank of Canada communications are relatively more important for short-term interest rates and the exchange rate.

As per the Bank of Canada methodology for calculating CORRA, the CORRA Advisory Group (CAG) has been established to advise the Bank’s CORRA Oversight Committee on any potential adjustments to the CORRA methodology, stemming from changes in repo market functioning and from any emerging methodology issues, as well as on any changes undertaken as part of regular methodology reviews.

The Bank updated its forecast for real economic growth to 1.3 percent this year, 1.9 percent next year and 2.0 percent in 2021.

Unregulated capital flows are likely excessive during a stagflation episode, owing to a macroeconomic externality operating through the economy’s supply side. Inflows raise domestic wages and cause unwelcome upward pressure on firm costs, yet market forces likely generate such inflows. Optimal capital flow management instead requires net outflows.

The Canadian financial system has fared relatively well through this crisis, thanks to effective regulation and prudent practices that have worked like sandbags to protect our financial system from the storms in today's global economy.