Recent Evolution of Canada’s Credit-to-GDP Gap: Measurement and Interpretation Staff Analytical Note 2017-25 Timothy Grieder, Dylan Hogg, Thibaut Duprey Over the past several years, the Bank for International Settlements has noted that Canada’s credit-to-GDP gap has widened and is above thresholds indicating future banking stress. Content Type(s): Staff research, Staff analytical notes Research Topic(s): Business fluctuations and cycles, Credit and credit aggregates, Financial stability, Monetary and financial indicators, Recent economic and financial developments, Sectoral balance sheet JEL Code(s): D, D1, E, E3, E32, G, G0, G01, G1, G2, G21, G3, G30
A central bank digital currency for offline payments Staff Analytical Note 2023-2 Cyrus Minwalla, John Miedema, Sebastian Hernandez, Alexandra Sutton-Lalani Offline functionality is a key consideration for a potential CBDC. We describe the different types of offline functionality based on their duration outside of network connection—either intermittent (for short periods) or extended (for longer periods). We discuss the advantages and drawbacks of each and consider implications for end-user devices, system resilience and universal accessibility. Content Type(s): Staff research, Staff analytical notes Research Topic(s): Central bank research, Digital currencies and fintech JEL Code(s): E, E4, E42, E5, E51, E58, O, O3, O31
Centralizing Over-the-Counter Markets? Staff Working Paper 2021-39 Jason Allen, Milena Wittwer Would a shift in trading in fixed-income markets—from over the counter (bilateral trading) to a centralized electronic platform—improve welfare? We use trade-level data on the secondary market for Government of Canada debt to answer this question. Content Type(s): Staff research, Staff working papers Research Topic(s): Financial institutions, Market structure and pricing JEL Code(s): D, D4, D40, D47, G, G1, G10, G2, G20, L, L1, L10
Relative Price Movements and Labour Productivity in Canada: A VAR Analysis Staff Discussion Paper 2010-5 Michael Dolega, David Dupuis, Lise Pichette In recent years, the Canadian economy has been affected by strong movements in relative prices brought about by the surging costs of energy and non-energy commodities, with significant implications for the terms of trade, the exchange rate, and the allocation of resources across Canadian sectors and regions. Content Type(s): Staff research, Staff discussion papers Research Topic(s): Labour markets, Productivity, Recent economic and financial developments JEL Code(s): E, E2, E23, E24, O, O4, O47
L'effet de la richesse sur la consommation aux États-Unis Staff Working Paper 2001-14 Yanick Desnoyers The substantial growth in wealth over the course of the second half of the 1990s generated the equivalent of a certain level of savings, while simultaneously causing household savings rates to fall significantly. The author seeks to explain this decline in savings, observed since 1995, using the methodology developed by King, Plosser, Stock, and Watson (1991). Content Type(s): Staff research, Staff working papers Research Topic(s): Domestic demand and components JEL Code(s): E, E2, E21
Behavioral Learning Equilibria in New Keynesian Models Staff Working Paper 2022-42 Cars Hommes, Kostas Mavromatis, Tolga Özden, Mei Zhu We introduce behavioral learning equilibria (BLE) into DSGE models with boundedly rational agents using simple but optimal first order autoregressive forecasting rules. The Smets-Wouters DSGE model with BLE is estimated and fits well with inflation survey expectations. As a policy application, we show that learning requires a lower degree of interest rate smoothing. Content Type(s): Staff research, Staff working papers Research Topic(s): Business fluctuations and cycles, Economic models, Inflation and prices, Monetary policy JEL Code(s): C, C1, C11, D, D8, D83, D84, E, E3, E6, E62
Liquidity Transformation and Bank Capital Requirements Staff Working Paper 2010-22 Hajime Tomura This paper presents a dynamic general equilibrium model where asymmetric information about asset quality leads to asset illiquidity. Banking arises endogenously in this environment as banks can pool illiquid assets to average out their idiosyncratic qualities and issue liquid liabilities backed by pooled assets whose total quality is public information. Content Type(s): Staff research, Staff working papers Research Topic(s): Financial stability, Financial system regulation and policies JEL Code(s): D, D8, D82, E, E4, E44, G, G2, G21
Real-Financial Linkages in the Canadian Economy: An Input-Output Approach Staff Working Paper 2011-14 Danny Leung, Oana Secrieru The purpose of this paper is twofold. First, we provide a detailed social accounting matrix (SAM), which incorporates the income and financial flows into the standard input-output matrix, for the Canadian economy for 2004. Content Type(s): Staff research, Staff working papers Research Topic(s): Economic models, Financial markets, Sectoral balance sheet JEL Code(s): C, C6, C67, D, D5, D57
Monetary Commitment and the Level of Public Debt Staff Working Paper 2016-3 Stefano Gnocchi, Luisa Lambertini We analyze the interaction between committed monetary policy and discretionary fiscal policy in a model with public debt, endogenous government expenditures, distortive taxation and nominal rigidities. Content Type(s): Staff research, Staff working papers Research Topic(s): Credibility, Fiscal policy, Inflation targets, Monetary policy framework JEL Code(s): E, E2, E24, E3, E32, E5, E52
May 17, 1996 The Transmission of Monetary Policy Gordon Thiessen, Bruce Montador, Kevin Clinton, Kevin Fettig, Donna Howard, Charles Freedman, Pierre Duguay, Stephen S. Poloz, Tim Noël Text of major 1995 lecture by Bank Governor Gordon Thiessen, plus articles from Bank of Canada Review and other sources Content Type(s): Publications, Books and monographs Research Topic(s): Monetary policy transmission JEL Code(s): E, E5