Inflation and prices

• December 22, 2005

  70 Years of Central Banking: The Bank of Canada in an International Context, 1935–2005

  Bank of Canada Review - Winter 2005-2006 Michael Bordo, Angela Redish

  Bordo and Redish examine the evolution of central banking over the past 70 years and identify periods where Canada was either a notable innovator with regard to central banking practices or appeared to be following a slightly different course. They note that global forces seemed to play an important role in determining inflation outcomes throughout the 70-year period, and that Canada and the United States experienced roughly similar inflation rates despite some important differences in their monetary policy regimes. Canada, for example, was comparatively late in establishing a central bank, launching the Bank of Canada long after most other industrial countries had one. Canada also operated under a flexible exchange rate through much of the Bretton Woods period, unlike any other country in the 1950s and early 1960s; adopted inflation targets well before most other central banks; and introduced a number of other innovative changes with regard to the implementation of monetary policy in the 1990s.

  Content Type(s): Publications, Bank of Canada Review articles Topic(s): Exchange rates, Inflation and prices, Monetary policy framework

• Forecasting Core Inflation in Canada: Should We Forecast the Aggregate or the Components?

  Staff Working Paper 2005-44 Frédérick Demers, Annie De Champlain

  The authors investigate the behaviour of core inflation in Canada to analyze three key issues: (i) homogeneity in the response of various price indexes to demand or real exchange rate shocks relative to the response of aggregate core inflation; (ii) whether using disaggregate data helps to improve the forecast of core inflation; and (iii) whether using monthly data helps to improve quarterly forecasts.

  Content Type(s): Staff research, Staff working papers Topic(s): Econometric and statistical methods, Inflation and prices JEL Code(s): C, C5, E, E3, E37

• The 1975–78 Anti-Inflation Program in Retrospect

  Staff Working Paper 2005-43 John Sargent

  The author provides an overview of the 1975–78 Anti-Inflation Program (AIP), in a background document prepared for a seminar organized by the Bank of Canada to mark the AIP's 30th anniversary.

  Content Type(s): Staff research, Staff working papers Topic(s): Credibility, Fiscal policy, Inflation and prices, Inflation targets, Monetary policy framework, Monetary policy implementation JEL Code(s): E, E3, E31, E5, E52, E6, E63, E64, E65

• Measurement Bias in the Canadian Consumer Price Index

  Staff Working Paper 2005-39 James Rossiter

  The consumer price index (CPI) is the most commonly used measure of inflation in Canada.

  Content Type(s): Staff research, Staff working papers Topic(s): Inflation and prices, Inflation targets JEL Code(s): E, E3, E31, E5, E52