December 21, 2006 Using No-Arbitrage Models to Predict Exchange Rates Financial System Review - December 2006 Antonio Diez de los Rios Content Type(s): Publications, Financial System Review articles
December 21, 2006 Financial System Review - December 2006 The financial system makes an important contribution to the welfare of all Canadians. The ability of households and firms to confidently hold and transfer financial assets is one of the fundamental building blocks of the Canadian economy. Content Type(s): Publications, Financial Stability Report
December 20, 2006 Why Monetary Policy Matters: A Canadian Perspective Bank of Canada Review - Winter 2006-2007 Christopher Ragan This article provides answers to several key questions about Canadian monetary policy. First, what is monetary policy? Second, why does the Bank of Canada focus on the control of inflation rather than other macroeconomic variables? Third, how do the Bank's actions influence the rate of inflation? And, finally, how can monetary policy deliver genuine and significant benefits to society? Content Type(s): Publications, Bank of Canada Review articles Topic(s): Business fluctuations and cycles, Inflation: costs and benefits, Monetary policy framework
December 18, 2006 A Summary of the Bank of Canada Conference on Fixed-Income Markets, 3–4 May 2006 Bank of Canada Review - Winter 2006-2007 Gregory Bauer, Scott Hendry The Bank of Canada's interest in fixed-income markets spans several of its functional areas of responsibility, including monetary policy, funds management, and financial system stability and efficiency. For that reason, the 2006 conference brought together top academics and central bankers from around the world to discuss leading-edge work in the field of fixed-income research. The papers and discussions cover such topics as the efficiency of fixed-income markets, price formation, the determinants of the yield curve, and volatility modelling. This article provides a short summary of each conference paper and the ensuing discussion. Content Type(s): Publications, Bank of Canada Review articles Topic(s): Debt management, Financial markets, Interest rates
December 8, 2006 Perspectives on Productivity and Potential Output Growth: A Summary of the Joint Banque de France/Bank of Canada Workshop, 24–25 April 2006 Bank of Canada Review - Winter 2006-2007 Gilbert Cette, Donald Coletti A nation's productivity is the prime determinant of its real incomes and standard of living, as well as being a major determinant of its potential output. In the short run, deviations of actual output from potential output are a useful indicator of inflationary pressures. This article is a short summary of the proceedings of the workshop, which focus on productivity and potential output growth among industrialized countries. The research is organized under three main themes: estimating potential growth; productivity and growth; and institutions, policies, and growth. Content Type(s): Publications, Bank of Canada Review articles Topic(s): International topics, Potential output, Productivity
December 6, 2006 The Art and Design of Canadian Bank Notes This volume offers readers a behind-the-scenes look at the demanding world of bank note design, highlighting the beauty of Canada's bank notes and celebrating the engraver's art. Soft cover, 124 pages (2006). Content Type(s): Publications, Books and monographs, Souvenir books Topic(s): Bank notes
October 22, 2006 ToTEM: The Bank of Canada's New Projection and Policy-Analysis Model Bank of Canada Review - Autumn 2006 Paul Fenton, Stephen Murchison The Terms-of-Trade Economic Model, or ToTEM, replaced the Quarterly Projection Model (QPM) in December 2005 as the Bank's principal projection and policy-analysis model for the Canadian economy. Benefiting from advances in economic modelling and computer power, ToTEM builds on the strengths of QPM, allowing for optimizing behaviour on the part of firms and households, both in and out of steady state, in a multi-product environment. The authors explain the motivation behind the development of ToTEM, provide an overview of the model and its calibration, and present several simulations to illustrate its key properties, concluding with some indications of how the model is expected to evolve going forward. Content Type(s): Publications, Bank of Canada Review articles Topic(s): Business fluctuations and cycles, Economic models
October 22, 2006 Bank of Canada Review - Autumn 2006 Cover page The "pretended" Bank of Upper Canada — Kingston (1819-22) The note is part of the National Currency Collection of the Bank of Canada. Photography by Gord Carter Content Type(s): Publications, Bank of Canada Review
October 20, 2006 MUSE: The Bank of Canada's New Projection Model of the U.S. Economy Bank of Canada Review - Autumn 2006 Marc-André Gosselin, René Lalonde, Nicolas Parent Staff projections provided for the Bank of Canada's monetary policy decision process take into account the integration of Canada's very open economy within the global economy, as well as its close real and financial linkages with the United States. To provide inputs for this projection, the Bank has developed several models, including MUSE, NEUQ (the New European Quarterly Model), and BoC-GEM (Bank of Canada Global Economy Model), to analyze and forecast economic developments in the rest of the world. The authors focus on MUSE, the model currently used to describe interaction among the principal U.S. economic variables, including gross domestic product, inflation, interest rates, and the exchange rate. Brief descriptions are also provided of NEUQ and BoC-GEM. Content Type(s): Publications, Bank of Canada Review articles Topic(s): Econometric and statistical methods, Economic models, International topics
October 19, 2006 Monetary Policy Report – October 2006 The Canadian economy continues to operate just above its full production capacity, and the near-term outlook for core inflation has moved slightly higher. Content Type(s): Publications, Monetary Policy Report