How Do Canadian Banks That Deal in Foreign Exchange Hedge Their Exposure to Risk? Staff Working Paper 2002-34 Chris D'Souza This paper examines the daily hedging and risk-management practices of financial intermediaries in the Canadian foreign exchange (FX) market. Content Type(s): Staff research, Staff working papers Research Topic(s): Financial institutions, Financial markets, Market structure and pricing JEL Code(s): F, F3, F31, G, G1, G14, G2, G21
Inventories, Stockouts, and ToTEM Staff Discussion Paper 2010-8 Oleksiy Kryvtsov, Yang Zhang Inventory investment is an important component of the Canadian business cycle. Despite its small average size – less than 1 per cent of output – it exhibits volatile procyclical fluctuations, accounting for almost one-third of output variance. Content Type(s): Staff research, Staff discussion papers Research Topic(s): Business fluctuations and cycles, Monetary policy transmission JEL Code(s): E, E3, E31, E32
Limiting Sender’s Information in Bayesian Persuasion Staff Working Paper 2019-10 Shota Ichihashi This paper studies how the outcome of Bayesian persuasion depends on a sender’s information. I study a game in which, prior to the sender’s information disclosure, the designer can restrict the most informative signal that the sender can generate. Content Type(s): Staff research, Staff working papers Research Topic(s): Economic models JEL Code(s): D, D8, D82, D83
Corporate investment and monetary policy transmission in Canada Staff Analytical Note 2020-26 Min Jae Kim, Jonathan Witmer Unexpected changes in interest rates lead small firms to materially change their investment rate. Large firms, in contrast, show a smaller response. This suggests both that financial conditions are an important channel for transmitting monetary policy and that firm characteristics can help us better understand fluctuations in business investment. Content Type(s): Staff research, Staff analytical notes Research Topic(s): Firm dynamics, Monetary policy, Monetary policy transmission JEL Code(s): D, D2, D22, D9, D92, G, G3, G31, G32
The Case of Serial Disappointment Staff Analytical Note 2016-10 Justin-Damien Guénette, Nicholas Labelle, Martin Leduc, Lori Rennison Similar to those of other forecasters, the Bank of Canada’s forecasts of global GDP growth have shown persistent negative errors over the past five years. This is in contrast to the pre-crisis period, when errors were consistently positive as global GDP surprised to the upside. All major regions have contributed to the forecast errors observed since 2011, although the United States has been the most persistent source of notable errors. Content Type(s): Staff research, Staff analytical notes Research Topic(s): Business fluctuations and cycles, Domestic demand and components, Economic models, International topics, Monetary policy and uncertainty, Potential output JEL Code(s): E, E2, E27, E6, E66, F, F0, F01
Assessing global potential output growth and the US neutral rate: April 2022 Staff Analytical Note 2022-4 Kyle Boutilier, Thomas J. Carter, Xin Scott Chen, Eshini Ekanayake, Louis Poirier, Peter Shannon, Akash Uppal, Lin Xiang We expect global potential output growth to increase from 2.7% in 2021 to 2.9% by 2024. Compared with the April 2021 assessment, global potential output growth is marginally slower. The current range for the US neutral rate is 2% to 3%, 0.25 percentage points higher than staff’s last assessment. Content Type(s): Staff research, Staff analytical notes Research Topic(s): Interest rates, Monetary policy, Potential output, Productivity JEL Code(s): E, E1, E2, E4, E5, F, F0, O, O4
December 10, 2013 Assessing the Systemic Importance of Financial Institutions Financial System Review - December 2013 Éric Chouinard, Erik Ens Content Type(s): Publications, Financial System Review articles
August 23, 2003 Financial Developments in Canada: Past Trends and Future Challenges Bank of Canada Review - Summer 2003 Charles Freedman, Walter Engert Freedman and Engert focus on the changing pattern of lending and borrowing in Canada in the past thirty to forty years, including the types of financial instruments used and the relative roles of financial institutions and financial markets. They examine how borrowing mechanisms have changed over time and consider the challenges facing the Canadian financial sector, including whether our financial markets are in danger of disappearing because of the size and pre-eminence of U.S. financial markets. Some of the trends examined here include syndicated lending, securitization, and credit derivatives, a form of financial engineering that has become increasingly important in the last few years. They also study bond and equity markets to determine whether Canadian capital markets have been hollowed out or abandoned by Canadian firms and conclude that the data do not provide much support for that view. Content Type(s): Publications, Bank of Canada Review articles Research Topic(s): Financial institutions, Financial markets, Financial services, Recent economic and financial developments
Ownership Concentration and Competition in Banking Markets Staff Working Paper 2006-7 Alexandra Lai, Raphael Solomon Many countries prohibit large shareholdings in their domestic banks.The authors examine whether such a restriction restrains competition in a duopolistic loan market. Blockholders may influence managers' output decisions by choosing capital structure, as in Brander and Lewis (1986). Content Type(s): Staff research, Staff working papers Research Topic(s): Financial institutions, Financial services, Financial system regulation and policies JEL Code(s): G, G2, G21, G28, G3, G32, L, L1, L10
What Affects MFP in the Long-Run? Evidence from Canadian Industries Staff Working Paper 2008-4 Danny Leung, Yi Zheng In this paper we explore variables that may have an impact on multifactor productivity (MFP) in the long-run using the KLEMS database for Canada. We estimate a dynamic heterogeneous panel error-correction model of twelve 2-digit level industries. Content Type(s): Staff research, Staff working papers Research Topic(s): Productivity JEL Code(s): C, C2, C23, D, D2, D24, O, O3, O30