October 22, 2003
Posts
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February 21, 2019
Toward 2021: The Power—and Limitations—of Policy
Governor Poloz explains that monetary policy is a powerful tool to promote economic welfare, but it also has some important limits. -
December 6, 2018
Year-End Economic Progress Report: Financial Vulnerabilities in Focus
Governor Poloz talks about how household debt levels and housing markets played a role in the latest interest-rate decision. -
Bond Liquidity Premia
Recent asset pricing models of limits to arbitrage emphasize the role of funding conditions faced by financial intermediaries. In the US, the repo market is the key funding market. Then, the premium of on-the-run U.S. Treasury bonds should share a common component with risk premia in other markets. -
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. -
January 20, 2004
Bank of Canada lowers target for the overnight rate by 1/4 percentage point to 2 1/2 per cent
Bank of Canada today announced that it is lowering its target for the overnight rate by one-quarter of one percentage point to 2 1/2 per cent. The operating band for the overnight rate is correspondingly lowered, and the Bank Rate is now 2 3/4 per cent. -
November 19, 2002
Purchasing-Power Parity: Definition, Measurement, and Interpretation
This article examines the concept of purchasing-power parity (PPP) and its implications for the equilibrium value of the Canadian exchange rate. PPP has two main applications, as a theory of exchange rate determination and as a means to compare living standards across countries. Concerning exchange rate determination, PPP is mainly useful as a reminder that monetary policy has no long-run impact on the real exchange rate, since the exchange rate can deviate persistently from its PPP value in response to real shocks. To compare living standards across countries, PPP exchange rates constructed by comparing the prices of national consumption baskets are used to translate per capita national incomes into a common currency. These rates are useful because they offset differences in national price levels to obtain comparable measures of purchasing power, but they are not an accurate measure of the equilibrium value of the exchange rate. The authors conclude that the current deviation of the Canadian exchange rate from the PPP rate does not imply that the exchange rate is undervalued, but that this deviation reflects the impact of persistent real factors, in particular, lower commodity prices. -
July 15, 2003
Bank of Canada lowers target for the overnight rate by 1/4 percentage point to 3 per cent
The Bank of Canada today announced that it is lowering its target for the overnight rate by one-quarter of one percentage point to 3 per cent. -
November 30, 2014
Research Update - November 2014
This monthly newsletter features the latest research publications by Bank of Canada economists including external publications and working papers published on the Bank of Canada’s website. -
July 18, 2012
Monetary Policy Report – July 2012
The Bank projects that the economy will grow by 2.1 per cent in 2012, 2.3 per cent in 2013 and 2.5 per cent in 2014. The economy is expected to reach full capacity in the second half of 2013.