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August 16, 2012

Bank of Canada Review - Summer 2012

This issue features three articles that present research and analysis by Bank of Canada staff. The first updates previous Bank estimates of measurement bias in the Canadian consumer price index; the second uses a new term-structure model to analyze the relationship between the short-term policy rate and long-term interest rates; and the third examines indicators of balance-sheet risks at financial institutions in Canada.

Intertemporal Substitution in Macroeconomics: Evidence from a Two-Dimensional Labour Supply Model with Money

Staff Working Paper 2005-30 Ali Dib, Louis Phaneuf
The hypothesis of intertemporal substitution in labour supply has a history of empirical failure when confronted with aggregate time-series data.

Central Bank Communications Before, During and After the Crisis: From Open-Market Operations to Open-Mouth Policy

Staff Working Paper 2013-41 Ianthi Vayid
The days when secrecy and opacity were the bywords of central banking are gone. The advent of inflation targeting in the early 1990s acted as the catalyst for enhanced transparency and communications in the conduct of monetary policy.

Potential output and the neutral rate in Canada: 2021 update

We expect potential output growth to be higher than in the October 2020 reassessment. By 2024, growth will be slightly above its average growth from 2010 to 2019. We assess that the Canadian nominal neutral rate continues to lie in the range of 1.75 to 2.75 percent.

Household Risk Management and Actual Mortgage Choice in the Euro Area

Staff Working Paper 2014-1 Michael Ehrmann, Michael Ziegelmeyer
Mortgages constitute the largest part of household debt. An essential choice when taking out a mortgage is between fixed-interest-rate mortgages (FRMs) and adjustable-interest-rate mortgages (ARMs). However, so far, no comprehensive cross‐country study has analyzed what determines household demand for mortgage types, a task that this paper takes up using new data for the euro area.
Content Type(s): Staff research, Staff working papers Research Topic(s): Credit and credit aggregates, Monetary policy transmission JEL Code(s): D, D1, D12, E, E4, E43, E5, E52, G, G2, G21
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