Find Bank of Canada research by keyword, author, content type, JEL code, topic or date of publication.
Receive notification by email whenever new research is added to the website.
2399
result(s)
May 11, 1996
Recent developments in monetary aggregates and their implications
In 1995, the broad aggregate M2+ grew at an annual rate of 4.5 per cent—almost twice the rate recorded in 1994—as competition from mutual funds drew less money from personal savings deposits. An adjusted M2+ aggregate, which internalizes the effect of close substitutes such as CSBs and certain mutual funds, grew by only 3.4 per cent. Gross M1 grew by 8.2 per cent during the year, reflecting an increased demand for transactions balances as market interest rates declined and as banks offered more attractive rates of interest on corporate current account balances. The robust growth of gross M1 in the second half of 1995 suggests a moderate expansion of economic activity in the first half of 1996, while moderate growth in the broad aggregates indicates a rate of monetary expansion consistent with continued low inflation. In this annual review of the monetary aggregates, the authors also introduce a new model, based on calculated deviations of M1 from its long-run demand, which suggests that inflation should remain just below the midpoint of the inflation-control target range over the next couple of years.
Content Type(s):
Publications,
Bank of Canada Review articles
Topic(s):
Monetary aggregates,
Recent economic and financial developments
May 10, 1996
Financing activities of provincial governments and their enterprises
This article examines the changes that have occurred in the composition of funds raised by provincial borrowers during the 1990s. Higher financing requirements, coupled with the declining availability of funds from non-market sources such as the Canada Pension Plan, led provincial governments and their Crown corporations to broaden and to diversify their debt management programs. In particular, provincial borrowers expanded their presence in foreign bond markets, increased their issuance of floating-rate debt, and incorporated a wide variety of innovative debt instruments into their borrowing programs in order to minimize their borrowing costs and to manage the risks associated with the issuing of debt. As a result, the composition of funds raised by provincial borrowers during the 1990s differed markedly from that of the previous decade: between 1990 and 1995, provincial borrowing requirements were met almost entirely through the issuance of marketable debt, and net new foreign currency debt issues averaged nearly 50 per cent of funds raised, whereas between 1980 and 1989, non-market sources provided close to 30 per cent of funds raised, and net new foreign currency debt issues provided less than 20 per cent.
Content Type(s):
Publications,
Bank of Canada Review articles
Topic(s):
Debt management,
Fiscal policy
May 9, 1996
The role of inventory management in Canadian economic fluctuations
Swings in inventory investment have traditionally played a major role in Canadian business cycles. However, advances in inventory-control techniques and the reduced uncertainty associated with lower inflation have enabled firms to manage their inventories much more tightly and effectively. This article examines recent developments in the management of non-farm business inventories in Canada at both the aggregate and the sectoral level and looks at implications for the role of inventories as a source of economic fluctuation.
Content Type(s):
Publications,
Bank of Canada Review articles
Topic(s):
Domestic demand and components
An Econometric Examination of the Trend Unemployment Rate in Canada
Staff Working Paper 1996-7
Denise Côté,
Doug Hostland
This paper attempts to identify the trend unemployment rate, an empirical concept, using cointegration theory. The authors examine whether there is a cointegrating relationship between the observed unemployment rate and various structural factors, focussing neither on the non-accelerating-inflation rate of unemployment (NAIRU) nor on the natural rate of unemployment, but rather on the trend unemployment rate, which they define in terms of cointegration.
Content Type(s):
Staff research,
Staff working papers
Topic(s):
Labour markets
JEL Code(s):
E,
E2,
E24
The Bank of Canada's New Quarterly Projection Model, Part 3. The Dynamic Model: QPM
Technical Report No. 75
Donald Coletti,
Benjamin Hunt,
David Rose,
Robert Tetlow
The Bank of Canada's new Quarterly Projection Model, QPM, combines the short-term dynamic properties necessary to support regular economic projections with the consistent behavioural structure necessary for policy analysis.
Content Type(s):
Staff research,
Technical reports
Topic(s):
Economic models
JEL Code(s):
C,
C5,
C53,
E,
E1,
E17
Provincial Credit Ratings in Canada: An Ordered Probit Analysis
Staff Working Paper 1996-6
Stella Cheung
The author estimates the relationship between the provincial credit ratings, as assessed by Standard & Poor's, and a number of economic variables, using the ordered probit methodology. All the variables in her estimation prove to be significant. In particular, she finds that downgrades take place at almost the same speed at different levels of the debt-to-GDP ratio, based on a pooled sample of nine provinces.
Content Type(s):
Staff research,
Staff working papers
Topic(s):
Financial markets
JEL Code(s):
H,
H6,
H63
A Distant-Early-Warning Model of Inflation Based on M1 Disequilibria
Staff Working Paper 1996-5
Joseph Atta-Mensah,
Walter Engert,
Scott Hendry,
Jamie Armour
A vector error-correction model (VECM) that forecasts inflation between the current quarter and eight quarters ahead is found to provide significant leading information about inflation. The model focusses on the effects of deviations of M1 from its long-run demand but also includes, among other things, the influence of the exchange rate, a simple measure of the output gap and past prices.
Content Type(s):
Staff research,
Staff working papers
Topic(s):
Economic models,
Monetary aggregates,
Monetary policy transmission
JEL Code(s):
E,
E3,
E37,
E5,
E52
Overnight Rate Innovations as a Measure of Monetary Policy Shocks in Vector Autoregressions
Staff Working Paper 1996-4
Walter Engert,
Ben Fung,
Jamie Armour
The authors examine the Bank of Canada's overnight rate as a measure of monetary policy in vector autoregression (VAR) models. Since the time series of the Bank's current measure of the overnight rate begins only in 1971, the authors splice it to day loan rate observations to obtain a sufficiently long period of data.
Content Type(s):
Staff research,
Staff working papers
Topic(s):
Economic models,
Monetary and financial indicators
JEL Code(s):
E,
E5,
E52
Regime-Switching Models: A Guide to the Bank of Canada Gauss Procedures
Staff Working Paper 1996-3
Simon van Norden,
Robert Vigfusson
This paper is a user's guide to a set of Gauss procedures developed at the Bank of Canada for estimating regime-switching models.
Content Type(s):
Staff research,
Staff working papers
Topic(s):
Econometric and statistical methods
JEL Code(s):
C,
C6,
C63