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As the ultimate provider of Canadian-dollar liquidity to the financial system, the Bank of Canada has the unique capacity to create Canadian-dollar claims on the central bank and the power to make secured loans or advances to chartered banks and other members of the Canadian Payments Association. The Bank supplies overnight credit on a routine basis through the Standing Liquidity Facility (SLF) to direct participants in the Large Value Transfer System, and Emergency Lending Assistance (ELA) to solvent deposit-taking institutions that require more substantial and prolonged credit. The authors review the policy framework that guides the Bank's lender-of-last-resort function, including the key issues, terms and conditions, and eligibility criteria associated with its SLF and ELA activities. Also discussed are foreign currency ELA, the relationship between SLF and ELA, systemic risk and Bank of Canada intervention, and the potential provision of liquidity to major clearing and settlement systems.

Consumers’ perceptions of current inflation remain elevated and are diverging from actual inflation. Perceptions of high inflation are also leading to persistently high expectations for inflation over the next 12 months. Consumers’ expectations for interest rates one year from now also remain high, and many consumers believe that the impacts of higher interest rates on their household spending are far from over. Homeowners with a variable-rate mortgage are more likely than other consumers to report being worse off due to high interest rates. Consumers’ plans to purchase services, such as vacations or concerts, are more widespread than plans to make major purchases of goods that are likely to be financed with loans, such as vehicles or appliances. Workers are reporting signs of job market cooling, such as more time spent looking for a new job, but they remain confident about the labour market.

This report discusses the decision not to designate the Automated Clearing Settlement System as a systemically important system, as well as some of the research contributing to that decision.

This paper examines the reliability of survey data on business incomes, valuations, and rates of return, which are key inputs for studies of wealth inequality and entrepreneurial choice.

This monthly newsletter features the latest research publications by Bank of Canada economists including external publications and working papers published on the Bank of Canada’s website.

As you know, many institutions, both governmental and private, are currently concerned about governance structures, accountability and rules of behaviour.

The impact of COVID-19 on Canadian households’ debt and unplanned savings varies by household income. Low-income and high-income households accrued unplanned savings, while middle-income households tended to accumulate more debt.

Dealers connect investors who want to buy or sell securities in financial markets. Over time, dealers and investors form trading networks to save time and resources. An emerging field of research investigates how networks form.

The Bank of Canada today announced that it is maintaining its target for the overnight rate at 1/4 per cent.