Inflation and prices

• The Determinants of Consumers’ Inflation Expectations: Evidence from the US and Canada

  Staff Working Paper 2020-52 Charles Bellemare, Rolande Kpekou Tossou, Kevin Moran

  We compare the determinants of consumer inflation expectations in the US and Canada by analyzing two current surveys. We find that Canadian consumers rely more on professional forecasts and the history of actual inflation when forming their expectations, while US consumers rely more on their own lagged expectations.

  Content Type(s): Staff research, Staff working papers Topic(s): Central bank research, Econometric and statistical methods, Inflation and prices, Inflation targets JEL Code(s): C, C3, C33, D, D8, D83, D84, E, E3, E31

• Has the Inflation Process Changed? Selective Review of Recent Research on Inflation Dynamics

  Staff Discussion Paper 2020-11 Oleksiy Kryvtsov, James (Jim) C. MacGee

  From 2011 to 2019, inflation in Canada and advanced economies usually registered below inflation targets, spurring the debate on whether the inflation process has changed. This paper highlights emerging questions that will influence the conduct of monetary policy in Canada in the near term.

  Content Type(s): Staff research, Staff discussion papers Topic(s): Central bank research, Inflation and prices, Monetary policy JEL Code(s): E, E3, E31, E5, E52

• Short-Run Dynamics in a Search-Theoretic Model of Monetary Exchange

  Staff Working Paper 2020-48 Jonathan Chiu, Miguel Molico

  We study the short-run effects of monetary policy using a search-theoretic monetary model in which agents are subject to idiosyncratic shocks and aggregate monetary shocks.

  Content Type(s): Staff research, Staff working papers Topic(s): Inflation and prices, Monetary policy, Monetary policy transmission JEL Code(s): E, E4, E40, E5, E50

• Understanding Trend Inflation Through the Lens of the Goods and Services Sectors

  Staff Working Paper 2020-45 Yunjong Eo, Luis Uzeda, Benjamin Wong

  The goods and services sectors have experienced considerably different dynamics over the past three decades. Our goal in this paper is to understand how such contrasting behaviors at the sectoral level affect the aggregate level of trend inflation dynamics.

  Content Type(s): Staff research, Staff working papers Topic(s): Econometric and statistical methods, Inflation and prices, Monetary policy transmission JEL Code(s): C, C1, C11, C3, C32, E, E3, E31, E5, E52

• What do high-frequency expenditure network data reveal about spending and inflation during COVID‑19?

  Staff Analytical Note 2020-20 Kim Huynh, Helen Lao, Patrick Sabourin, Angelika Welte

  The official consumer price index (CPI) inflation measure, based on a fixed basket set before the COVID 19 pandemic, may not fully reflect what consumers are currently experiencing. We partnered with Statistics Canada to construct a more representative index for the pandemic with weights based on real-time transaction and survey data.

  Content Type(s): Staff research, Staff analytical notes Topic(s): Inflation and prices, Payment clearing and settlement systems JEL Code(s): D, D1, D12, E, E3, E31, E4, E42, E5, E52
• August 25, 2020

  Our COVID-19 response: Large-scale asset purchases

  Paul Beaudry

  The Bank of Canada has taken many actions to support Canadians since the COVID-19 pandemic struck. These include large-scale asset purchases—buying a substantial amount of government bonds and other financial assets. Our purchases serve two purposes. They help key financial markets work properly, and they can help increase spending in the economy. This leads to more employment and stronger economic growth.

  Content Type(s): Publications, The Economy, Plain and Simple Topic(s): Coronavirus disease (COVID-19), Debt management, Financial markets, Financial stability, Inflation and prices, Interest rates, Market structure and pricing, Monetary policy, Monetary policy transmission
• August 25, 2020

  The gap between inflation perceptions and reality

  Speech summary Lawrence L. Schembri Canadian Association for Business Economics Kingston, Ontario

  Deputy Governor Lawrence Schembri talks about the difference between how Canadians perceive inflation and the actual measured rate, why this gap may exist, and what it could mean for monetary policy and the economy.

  Content Type(s): Press, Speeches and appearances, Speech summaries Topic(s): Central bank research, Coronavirus disease (COVID-19), Inflation and prices, Inflation targets, Monetary policy
• August 25, 2020

  Perceived inflation and reality: understanding the difference

  Remarks (delivered virtually) Lawrence L. Schembri Canadian Association for Business Economics Kingston, Ontario

  In a virtual address to the Canadian Association for Business Economics, Deputy Governor Lawrence Schembri discusses the difference between how Canadians perceive inflation and the actual measured rate. He explains why that gap may exist and what it could mean for monetary policy and the economy.

  Content Type(s): Press, Speeches and appearances, Remarks Topic(s): Central bank research, Coronavirus disease (COVID-19), Inflation and prices, Inflation targets, Monetary policy
• August 13, 2020

  Understanding inflation targeting

  At the Bank of Canada, we aim to keep inflation close to 2 percent.

  Content Type(s): Explainers Topic(s): Inflation and prices, Inflation targets
• August 13, 2020

  Understanding inflation

  Inflation is a persistent rise in the average level of prices over time.

  Content Type(s): Explainers Topic(s): Inflation and prices, Inflation: costs and benefits