Inflation and prices

• July 9, 2024

  What drives up the price of groceries

  

  Weather, energy prices, and labour and import costs all contribute to higher grocery prices

  Content Type(s): Publications, The Economy, Plain and Simple Research Topic(s): Exchange rates, Inflation and prices, Inflation targets, Labour markets

• The Output-Inflation Trade-off in Canada

  Staff Discussion Paper 2024-7 Stefano Gnocchi, Fanny McKellips, Rodrigo Sekkel, Laure Simon, Yinxi Xie, Yang Zhang

  We explain how the Bank of Canada’s policy models capture the trade-off between output and inflation in Canada. We provide new estimates of the trade-off and contrast them with those in the Bank’s macroeconomic models.

  Content Type(s): Staff research, Staff discussion papers Research Topic(s): Business fluctuations and cycles, Econometric and statistical methods, Inflation and prices, Monetary policy transmission JEL Code(s): E, E3, E31, E5, E52
• June 19, 2024

  What you pay for at the pump

  

  Kun Mo

  Several factors help set gasoline prices: the costs of crude oil, refining, transporting, retailing and marketing gas, as well as taxes.

  Content Type(s): Publications, The Economy, Plain and Simple Research Topic(s): Exchange rates, Inflation and prices, Market structure and pricing
• June 13, 2024

  Reviewing our pandemic actions

  Speech summary Sharon Kozicki Canadian Association for Business Economics Ottawa, Ontario

  Deputy Governor Sharon Kozicki talks about the importance of central bank transparency and accountability. She looks at the exceptional monetary policy measures the Bank of Canada used during the COVID-19 pandemic and analyzes their effectiveness.

  Content Type(s): Press, Speeches and appearances, Speech summaries Research Topic(s): Central bank research, Coronavirus disease (COVID-19), Credibility, Economic models, Financial stability, Inflation and prices, Inflation targets, Interest rates, Monetary policy, Monetary policy and uncertainty, Monetary policy communications, Recent economic and financial developments
• June 13, 2024

  Exceptional policies for an exceptional time: From quantitative easing to quantitative tightening

  Remarks Sharon Kozicki Canadian Association of Business Economics Ottawa, Ontario

  Deputy Governor Sharon Kozicki discusses the use of exceptional monetary policy tools during the COVID-19 pandemic, as well as the Bank’s commitment to transparency and accountability.

  Content Type(s): Press, Speeches and appearances, Remarks Research Topic(s): Central bank research, Coronavirus disease (COVID-19), Credibility, Economic models, Financial stability, Inflation and prices, Inflation targets, Interest rates, Monetary policy, Monetary policy and uncertainty, Monetary policy communications, Recent economic and financial developments

• Sources of pandemic-era inflation in Canada: An application of the Bernanke and Blanchard model

  Staff Analytical Note 2024-13 Fares Bounajm, Jean Garry Junior Roc, Yang Zhang

  We explore the drivers of the surge in inflation in Canada during the COVID-19 pandemic. This work is part of a joint effort by 11 central banks using the model developed by Bernanke and Blanchard (2023) to identify similarities and differences across economies.

  Content Type(s): Staff research, Staff analytical notes Research Topic(s): Economic models, Inflation and prices, Labour markets JEL Code(s): E, E2, E24, E3, E31, E37, E5, E52, E6

• Assessing the Impact of the Bank of Canada’s Government Bond Purchases

  Staff Discussion Paper 2024-5 Chinara Azizova, Jonathan Witmer, Xu Zhang

  In March 2020, the Bank of Canada implemented the Government of Canada Bond Purchase Program, eventually purchasing approximately $340 billion of government bonds. In this paper, we analyze the impact of this program on financial market prices and yields as well as on GDP and inflation.

  Content Type(s): Staff research, Staff discussion papers Research Topic(s): Financial institutions, Financial markets, Financial system regulation and policies, Inflation and prices, Monetary policy, Monetary policy transmission JEL Code(s): E, E5, E52, E58, G, G2, G21, G28
• June 12, 2024

  Central banking: Navigating in a new world

  Remarks Tiff Macklem 30th Conference of Montréal: International Economic Forum of the Americas Montréal, Quebec

  Governor Tiff Macklem looks back on the lessons learned from post-pandemic inflation and discusses the challenges ahead.

  Content Type(s): Press, Speeches and appearances, Remarks Research Topic(s): Coronavirus disease (COVID-19), Inflation and prices, Inflation: costs and benefits, International topics, Monetary policy

• Markups and Inflation in Oligopolistic Markets: Evidence from Wholesale Price Data

  Staff Working Paper 2024-20 Patrick Alexander, Lu Han, Oleksiy Kryvtsov, Ben Tomlin

  We study how the interaction of market power and nominal price rigidity influences inflation dynamics. We find that pass-through declines with price stickiness when markets are concentrated, which implies a lower slope of the New Keynesian Phillips curve.

  Content Type(s): Staff research, Staff working papers Research Topic(s): Firm dynamics, Inflation and prices, Market structure and pricing, Monetary policy transmission JEL Code(s): D, D4, D43, E, E3, E31, L, L1, L13, L8, L81

• Endogenous Credibility and Wage-Price Spirals

  Staff Working Paper 2024-14 Olena Kostyshyna, Tolga Özden, Yang Zhang

  We quantitively assess the risks of a wage-price spiral occurring in Canada over history. We find the risk of a wage-price spiral increases when the inflation expectations become unanchored and the credibility of central banks declines.

  Content Type(s): Staff research, Staff working papers Research Topic(s): Business fluctuations and cycles, Credibility, Inflation and prices, Monetary policy JEL Code(s): C, C2, C22, E, E0, E00, E4, E47, E7