Staff research, Publications
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Assessing global potential output growth: April 2024
This note presents the annual update of Bank of Canada staff estimates for growth in global potential output. These estimates serve as key inputs to the analysis supporting the April 2024 Monetary Policy Report. -
Assessing the US and Canadian neutral rates: 2024 update
We assess both the US and Canadian nominal neutral rates to be in the range of 2.25% to 3.25%, somewhat higher than the range of 2.0% to 3.0% in 2023. The assessed range is back to the level it was at in April 2019. -
Benchmarks for assessing labour market health: 2024 update
We assess the health of the Canadian labour market. We find that it has seen gradual but material easing since 2023, amid some signs of structural changes. -
The Neutral Interest Rate: Past, Present and Future
The decline in safe real interest rates over the past three decades has reignited discussions on the neutral real interest rate, known as R*. We address the determinants and estimation methods of R*, as well as the factors influencing its decline and its future trajectory. -
April 24, 2024
Summary of Governing Council deliberations: Fixed announcement date of April 10, 2024
This is an account of the deliberations of the Bank of Canada’s Governing Council leading to the monetary policy decision on April 10, 2024. -
April 22, 2024
Market Participants Survey—First Quarter of 2024
The Market Participants Survey results are based on questionnaire responses from about 30 financial market participants. -
U.S. Macroeconomic News and Low-Frequency Changes in Small Open Economies’ Bond Yields
Using two complementary approaches, we investigate the importance of U.S. macroeconomic news in driving low-frequency fluctuations in the term structure of interest rates in Canada, Sweden and the United Kingdom. We find that U.S. macroeconomic news is particularly important to explain changes in the expectation components of the nominal, real and break-even inflation rates of small open economies. -
Liquidity risks at Canadian life insurance companies
We examine how life insurers manage liquidity risks created by their business model. We find that Canadian life insurers did not face significant liquidity draws and continued their usual investment behaviour during the COVID-19 crisis and as interest rates increased in 2022. -
Unintended Consequences of the Home Affordable Refinance Program
We investigate the unintended consequences of the Home Affordable Refinance Program (HARP). Originally designed to help borrowers refinance after the 2008–09 global financial crisis, HARP inadvertently strengthened the market power of incumbent lenders by creating a cost advantage for them. Despite a 2013 policy rectifying this cost advantage, we still find significant welfare losses for borrowers.