Credit and credit aggregates
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Recent Evolution of Canada’s Credit-to-GDP Gap: Measurement and Interpretation
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. -
November 28, 2017
Release of the Financial System Review
Press conference following the release of the Financial System Review. -
November 28, 2017
Analysis of Household Vulnerabilities Using Loan-Level Mortgage Data
This report examines detailed data on home mortgages to provide a better understanding of the vulnerabilities associated with the mortgage market. The proportion of low-ratio mortgages is growing, particularly in regions with strong house price growth. Moreover, these borrowers exhibit less flexibility to adverse shocks, since they have high debt levels relative to income and have taken mortgages with long amortization periods. -
Aggregate Fluctuations and the Role of Trade Credit
In an economy where production takes place in multiple stages and is subject to financial frictions, how firms finance intermediate inputs matters for aggregate outcomes. This paper focuses on trade credit—the lending and borrowing of input goods between firms—and quantifies its aggregate impacts during the Great Recession. -
June 28, 2017
Markets Calling: Intelligence Gathering at the Bank of Canada
Deputy Governor Lynn Patterson discusses how the Bank gathers financial market intelligence and what it is learning. -
June 8, 2017
Release of the Financial System Review
Press conference following the release of the Financial System Review. -
Optimal Capital Regulation
We study constrained-efficient bank capital regulation in a model with market-imposed equity requirements. Banks hold equity buffers to insure against sudden loss of access to funding. However, in the model, banks choose to only partially self-insure because equity is privately costly. -
Monetary Policy, Private Debt and Financial Stability Risks
Can monetary policy be used to promote financial stability? We answer this question by estimating the impact of a monetary policy shock on private-sector leverage and the likelihood of a financial crisis. Impulse responses obtained from a panel VAR model of 18 advanced countries suggest that the debt-to-GDP ratio rises in the short run following an unexpected tightening in monetary policy. -
December 15, 2016
Release of the Financial System Review
Press conference following the release of the Financial System Review.