Exchange Rate Pass-Through to Consumer Prices: Theory and Recent Evidence Staff Discussion Paper 2015-9 Laurence Savoie-Chabot, Mikael Khan In an open economy such as Canada’s, exchange rate movements can have a material impact on consumer prices. This is particularly important in the current context, with the significant depreciation of the Canadian dollar vis-a-vis the U.S. dollar since late 2012. Content Type(s): Staff research, Staff discussion papers Research Topic(s): Exchange rates, Inflation and prices JEL Code(s): E, E3, E31, E5, E52, F, F3, F31
The Optimal Level of the Inflation Target: A Selective Review of the Literature and Outstanding Issues Staff Discussion Paper 2015-8 Oleksiy Kryvtsov, Rhys R. Mendes Bank of Canada research done prior to the most recent renewal of the inflation-control agreement in 2011 concluded that the benefits associated with a target below 2 per cent were insufficient to justify the increased risk of being constrained by the zero lower bound (ZLB) on nominal interest rates. Content Type(s): Staff research, Staff discussion papers Research Topic(s): Inflation targets, Inflation: costs and benefits, Monetary policy framework JEL Code(s): E, E5, E52, E58
On the Nexus of Monetary Policy and Financial Stability: Recent Developments and Research Staff Discussion Paper 2015-7 Oleksiy Kryvtsov, Miguel Molico, Ben Tomlin Because financial and macroeconomic conditions are tightly interconnected, financial stability considerations are an important element of any monetary policy framework. Yet, the circumstances under which it would be appropriate for the Bank to use monetary policy to lean against financial risks need to be more fully specified (Côté 2014). Content Type(s): Staff research, Staff discussion papers Research Topic(s): Financial stability, Monetary policy framework JEL Code(s): E, E0, E4, E44, E5, E52, E58, G, G1, G18
Public Policy Objectives and the Next Generation of CPA Systems: An Analytical Framework Staff Discussion Paper 2015-6 James Chapman, Jonathan Chiu, Sajjad Jafri, Héctor Pérez Saiz The payments landscape in Canada is rapidly changing and will continue to evolve, fuelled by strong and persistent drivers. In Canada, the Canadian Payments Association (CPA) is on a path to modernize Canada’s core payment systems. Content Type(s): Staff research, Staff discussion papers Research Topic(s): Economic models, Financial services, Financial system regulation and policies, Payment clearing and settlement systems JEL Code(s): E, E4, E42, L, L1, L14, L15, L5, L52
Decomposing Movements in U.S. Non-Energy Import Market Shares Staff Discussion Paper 2015-5 Russell Barnett, Karyne B. Charbonneau Country market shares of U.S. non-energy imports have changed considerably since 2002, with varying volatility across three subperiods: pre-crisis (2002–07), crisis (2007–09) and post-crisis (2009–14). In this paper, we analyze market shares for four main trading partners of the United States (Canada, Mexico, China and Japan). Content Type(s): Staff research, Staff discussion papers Research Topic(s): International topics JEL Code(s): F, F1, F10, F14, F4
2013 Methods-of-Payment Survey Results Staff Discussion Paper 2015-4 Christopher Henry, Kim Huynh, Rallye Shen As the sole issuer of bank notes, the Bank of Canada conducts methods-of-payment (MOP) surveys to obtain a detailed and representative snapshot of Canadian payment choices, with a focus on cash usage. Content Type(s): Staff research, Staff discussion papers Research Topic(s): Bank notes, Digital currencies and fintech JEL Code(s): E, E4
Sluggish Exports in Advanced Economies: How Much Is Due to Demand? Staff Discussion Paper 2015-3 Louis Morel Exports in advanced economies have been relatively sluggish since 2011, growing at a much slower pace than observed before the global financial crisis. Content Type(s): Staff research, Staff discussion papers Research Topic(s): International topics, Recent economic and financial developments JEL Code(s): F, F1, F4
Changing Labour Market Participation Since the Great Recession: A Regional Perspective Staff Discussion Paper 2015-2 Calista Cheung, Dmitry Granovsky, Gabriella Velasco This paper discusses broad trends in labour force participation and part-time employment across different age groups since the Great Recession and uses provincial data to identify changes related to population aging, cyclical effects and other factors. Content Type(s): Staff research, Staff discussion papers Research Topic(s): Labour markets, Recent economic and financial developments, Regional economic developments JEL Code(s): E, E2, E24, E3, E32, J, J1, J2, J21, J6
Measuring Potential Output at the Bank of Canada: The Extended Multivariate Filter and the Integrated Framework Staff Discussion Paper 2015-1 Lise Pichette, Pierre St-Amant, Ben Tomlin, Karine Anoma Estimating potential output and the output gap - the difference between actual output and its potential - is important for the proper conduct of monetary policy. However, the measurement and interpretation of potential output, and hence the output gap, is fraught with uncertainty, since it is unobservable. Content Type(s): Staff research, Staff discussion papers Research Topic(s): Economic models, Inflation and prices, Labour markets, Productivity JEL Code(s): E, E0, E3, E31, E5, E52
Why Do Canadian Firms Invest and Operate Abroad? Implications for Canadian Exports Staff Discussion Paper 2014-7 Martin Coiteux, Patrick Rizzetto, Lena Suchanek, Jane Voll Canadian foreign direct investment and sales of Canadian multinational firms’ operations abroad, particularly in the manufacturing industry and in the United States, have accelerated sharply over the past decade. Content Type(s): Staff research, Staff discussion papers Research Topic(s): International topics, Recent economic and financial developments JEL Code(s): F, F1, F10, F2, F21, F23, F4, F41