Posts

• On the Wedge Between the PPI and CPI Inflation Indicators

  Staff Working Paper 2022-5 Shang-Jin Wei, Yinxi Xie

  We find that the CPI and PPI inflation indexes co-moved strongly throughout the late 20th century, but their correlation has fallen substantially since the early 2000s. We offer a structural explanation for this divergence based on the growth of global supply chains since 2000. This finding offers a unique perspective for the future design of optimal monetary policy.

  Content Type(s): Staff research, Staff working papers Topic(s): Inflation and prices, Inflation targets, International topics, Monetary policy JEL Code(s): E, E3, E31, E5, E52, E58, F, F1, F11, F12, F4, F41, F6, F62
• January 26, 2022

  Monetary Policy Report Press Conference Opening Statement

  Opening statement Tiff Macklem Ottawa, Ontario

  Governor Tiff Macklem discusses key issues involved in the Governing Council’s deliberations about the policy rate decision and the MPR.

  Content Type(s): Press, Speeches and appearances, Opening statements
• January 26, 2022

  Bank of Canada maintains policy rate, removes exceptional forward guidance

  Media Relations Ottawa, Ontario

  The Bank of Canada today held its target for the overnight rate at the effective lower bound of ¼ %, with the Bank Rate at ½ % and the deposit rate at ¼ %.

  Content Type(s): Press, Press releases
• January 26, 2022

  Monetary Policy Report – January 2022

  

  The Canadian economy entered 2022 in a strong position. The Bank is forecasting growth of 4% in 2022 and about 3½ % in 2023.

  Content Type(s): Publications, Monetary Policy Report
• January 25, 2022

  CFEC Releases Results of October 2021 Foreign Exchange Volume Survey

  The Canadian Foreign Exchange Committee (CFEC) released today the results of its October 2021 semi-annual survey of foreign exchange volumes in Canada.

  Content Type(s): Press, Market notices Source(s): Canadian Foreign Exchange Committee
• January 24, 2022

  Operational details for upcoming secondary market purchases of Government of Canada securities (January 31-February 11)

  As previously announced, the Bank of Canada (the Bank) launched on April 1, 2020 a program to purchase Government of Canada securities in the secondary market – the Government Bond Purchase Program (GBPP).

  Content Type(s): Press, Market notices Source(s): Government of Canada Bond Purchase Program
• January 18, 2022

  CARR Meeting (January 18, 2022)

  Content Type(s): Meetings Source(s): Canadian Alternative Reference Rate Working Group
• January 17, 2022

  Business Outlook Survey―Fourth Quarter of 2021

  In the fourth-quarter Business Outlook Survey, reports of supply chain bottlenecks and labour shortages remain elevated. Firms cited robust growth in demand, although those offering hard-to-distance services still had sales below pre-pandemic levels, even before the Omicron variant began spreading broadly. These factors are resulting in upward pressures on prices over the next year.

  Content Type(s): Publications, Business Outlook Survey
• January 17, 2022

  Canadian Survey of Consumer Expectations—Fourth Quarter of 2021

  This survey took place in November 2021 before the Omicron variant of COVID-19 began spreading broadly in Canada. In December, the number of COVID-19 cases rose dramatically and governments began to reimpose containment measures. Many Canadians think inflation will be high over the next two years because of supply disruptions caused by the pandemic. They are more concerned about inflation now than they were before the pandemic and believe it has become more difficult to control. However, near-term inflation expectations are not feeding into expectations for wage growth or longer-term inflation. Showing confidence in the labour market, workers are more likely than ever to want to change jobs.

  Content Type(s): Publications, Canadian Survey of Consumer Expectations

• The Financial Origins of Non-fundamental Risk

  Staff Working Paper 2022-4 Sushant Acharya, Keshav Dogra, Sanjay Singh

  We explore the idea that the financial sector can be a source of non-fundamental risk to the rest of the economy. We also consider whether policy can be used to reduce this risk—either by increasing the supply of publicly backed safe assets or by reducing the demand for safe assets.

  Content Type(s): Staff research, Staff working papers Topic(s): Asset pricing, Financial markets, Financial stability JEL Code(s): D, D5, D52, D8, D84, E, E6, E62, G, G1, G10, G12