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  • September 19, 2000

    Summary of Consultation Results

    On 19 September 2000, the Bank of Canada published details of its plan to adopt a new system of eight “fixed” or pre-specified dates each year for announcing any changes to the official interest rate that it uses to implement monetary policy. Before finalizing and implementing the specific calendar of fixed dates, including the day of the week and time of day for announcements, the Bank invited interested Canadians to provide their views on the new fixed-date system.
  • September 19, 2000

    A New System of Fixed Dates for Announcing Changes to the Bank Rate

    In November 2000, the Bank of Canada introduced a new system of eight "fixed" or pre-specified dates each year for announcing any changes to the official interest rate it uses to implement monetary policy. This paper describes the basic features of the proposed approach, elaborates its key advantages and identifies issues for consultation.
  • September 14, 2000

    Bank of Canada Governor reviews economic developments and outlines proposed new arrangements for announcing interest rate changes

    Media Relations Calgary, Alberta
    In a speech to the Calgary Chamber of Commerce today, Bank of Canada Governor Gordon Thiessen gave an update on the Bank's outlook for the Canadian economy. He also outlined plans to move to a system of pre-set dates for announcing changes in official interest rates as part of the Bank's ongoing efforts to improve […]
    Content Type(s): Press, Press releases

  • Inflation and the Tax System in Canada: An Exploratory Partial-Equilibrium Analysis

    Staff Working Paper 2000-18 Brian O'Reilly, Mylène Levac
    This paper reports on an exploratory application to Canadian data of an approach pioneered by Martin Feldstein (1997, 1999). Feldstein finds that even at low inflation rates there are costs arising from the distortions introduced by the interaction of inflation with the taxation of income from capital (capital gains, dividends, and interest) in a less-than-perfectly-indexed tax system.
    Content Type(s): Staff research, Staff working papers Topic(s): Inflation: costs and benefits JEL Code(s): E, E5, E6
  • August 16, 2000

    The Changing Face of Central Banking in the 1990s

    Bank of Canada Review - Summer 2000 Graydon Paulin
    During the 1990s, central banks in the industrialized countries made important changes in the way they operate. As part of these initiatives, central banks have endeavoured to define a set of best practices, learning from each other in the process. The goal was to improve and adapt the frameworks within which monetary policy is implemented. Clarifying Objectives A clear objective is a necessary starting point for any policy framework. The growing consensus that price stability is the most appropriate objective for monetary policy was perhaps one of the most critical developments of the past decade. Price stability is now universally regarded as the key contribution that monetary policy can make to promote sustainable growth and maximize the level of employment. Central banks also need a clear strategy for achieving their objective. A major development of the past decade was the growing popularity of inflation targets as the numerical focus for monetary policy. Clearly defined inflation targets focus policy on the variable that is directly associated with price stability. The Bank of Canada was one of the first to adopt (in 1991) a set of targets for inflation over a specified time horizon. Accountability Many central banks have acquired greater independence and this, together with the public's desire for more information from key public institutions, has raised the standards for accountability. At the same time, explicit targets provide a clear measure against which to judge the performance of the monetary authorities. Increased accountability also has implications for the overall transparency of the monetary authorities. In sum, central banks have become much more open institutions and are placing greater emphasis on their communications activities. As an example, comprehensive inflation reports have become key communications vehicles for a number of central banks. Many of the changes implemented by central banks stem from the desire to improve the credibility of monetary policy, thus making it easier for monetary authorities to achieve their objectives. Although it is difficult to ascertain the overall effect of the evolving policy framework, it is encouraging that inflation and inflation expectations were at low levels at the end of the 1990s, thus providing a solid base for monetary policy in the future.
    Content Type(s): Publications, Bank of Canada Review articles Topic(s): Credibility, Inflation targets, International topics, Monetary policy framework
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