March 10, 2011 Bank of Canada Announces Further Details on New Series of Polymer Bank Notes Media Relations Ottawa, Ontario The Bank of Canada today announced that it will begin circulating a new $100 polymer bank note in November 2011, with a polymer $50 note to follow in March 2012. The Bank also provided further technical and background information about the new bank notes. Content Type(s): Press, Press releases Topic(s): Bank notes
Inventories, Markups and Real Rigidities in Sticky Price Models of the Canadian Economy Staff Working Paper 2011-9 Oleksiy Kryvtsov, Virgiliu Midrigan Recent New Keynesian models of macroeconomy view nominal cost rigidities, rather than nominal price rigidities, as the key feature that accounts for the observed persistence in output and inflation. Kryvtsov and Midrigan (2010a,b) reassess these conclusions by combining a theory based on nominal rigidities and storable goods with direct evidence on inventories for the U.S. Content Type(s): Staff research, Staff working papers Topic(s): Business fluctuations and cycles, Monetary policy transmission JEL Code(s): E, E3, E31, F, F1, F12
Belief Dispersion and Order Submission Strategies in the Foreign Exchange Market Staff Working Paper 2011-8 Ingrid Lo, Stephen Sapp This paper empirically examines how dispersions across investors beliefs influence traders order submission decisions in the foreign exchange market. Previous research has found that dispersion in traders beliefs regarding future macroeconomic announcements has a significant impact on both price dynamics and trading volume before the announcements in the foreign exchange and other financial markets. Content Type(s): Staff research, Staff working papers Topic(s): Exchange rates, Market structure and pricing JEL Code(s): D, D4, G, G1
March 1, 2011 Bank of Canada maintains overnight rate target at 1 per cent Media Relations Ottawa, Ontario The Bank of Canada today announced that it is maintaining its target for the overnight rate at 1 per cent. The Bank Rate is correspondingly 1 1/4 per cent and the deposit rate is 3/4 per cent. Content Type(s): Press, Press releases
Money and Costly Credit Staff Working Paper 2011-7 Mei Dong I study an economy in which money and credit coexist as means of payment and the settlement of credit requires money. The model extends recent developments in microfounded monetary theory to address the choice of payment methods and the effects of inflation. Whether a buyer uses money or credit depends on the fixed cost of credit and the inflation rate. Content Type(s): Staff research, Staff working papers Topic(s): Credit and credit aggregates, Inflation: costs and benefits JEL Code(s): E, E4, E41, E5, E50
The Private Equity Premium Puzzle Revisited Staff Working Paper 2011-6 Katya Kartashova In this paper, I extend the results of Moskowitz and Vissing-Jørgensen (2002) on the returns to entrepreneurial investments in the United States. First, following the authors’ methodology I replicate the original findings from the Survey of Consumer Finances (SCF) for the period 1989–1998 and show that the returns to private and public equity are similar. Content Type(s): Staff research, Staff working papers Topic(s): Financial markets, Interest rates, Recent economic and financial developments JEL Code(s): G, G1, G11, G12, G2, G24, G3, G31, G32
February 18, 2011 Global imbalances: the international monetary system and financial stability Mark Carney, Governor of the Bank of Canada contributed the article "Global imbalances: the international monetary system and financial stability" to the Banque de France's Financial Stability Review. Content Type(s): Press, Announcements
February 17, 2011 Bank of Canada Review - Winter 2010-2011 This issue features a summary of the Bank’s annual conference, which this year dealt with financial globalization, and three articles that present research by Bank staff on Canada’s mortgage market, the role of adverse selection in financial crises, and payment networks. Content Type(s): Publications, Bank of Canada Review
February 17, 2011 Competition in the Canadian Mortgage Market Bank of Canada Review - Winter 2010-2011 Jason Allen This article begins with a brief examination of the Canadian mortgage market, focusing on the market’s evolution following changes to the Bank Act in 1992, which allowed chartered banks to enter the trust business, and the subsequent entrance of virtual banks and mortgage brokers. Content Type(s): Publications, Bank of Canada Review articles Topic(s): Interest rates, Market structure and pricing, Monetary policy transmission