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Freeman (1999) proposes a model in which discount window lending and open market operations have different effects. This is important because in most of the literature, these policies are indistinguishable.

We present a two-country model featuring risky lending and cross-border interbank market frictions.

This paper studies the interdependence between fiscal and monetary policy in a DSGE model with sticky prices and non-zero trend inflation. We characterize the fiscal and monetary policies by a rule whereby a given fraction k of the government debt must be backed by the discounted value of current and future primary surpluses.

The financial system makes an important contribution to the welfare of all Canadians. The ability of households and firms to confidently hold and transfer financial assets is one of the fundamental building blocks of the Canadian economy.

Quarterly Financial Report - First Quarter 2017 - For the period ended 31 March 2017

The Governing Council judges that the risks to the Canadian financial system have decreased somewhat relative to the December FSR, but that the overall level of risk remains high. The key risks are similar to those highlighted in December, and emanate primarily from the external environment.

Interest rates are working to moderate spending and inflation is easing gradually, though underlying pressures are proving persistent. The Bank projects that inflation will stay around 3% through the first half of 2024, returning to target in 2025.

This paper examines the implications of positive news about future asset values that turn out to be incorrect at a later date in an open economy model with banking. The model captures the patterns of bank credit and current account dynamics in Spain between 2000 and 2010. The model finds that the use of unconventional policies leads to a milder bust.

This issue features a summary of the Bank’s annual conference, Financial Intermediation and Vulnerabilities, which took place in October 2012, as well as two articles that present analysis of international macroeconomic coordination since the global financial crisis and the U.S. recovery from the Great Recession.

The Bank projects that growth in the Canadian economy will accelerate from 1.6 percent this year to 2 percent in 2021.