The Welfare Cost of Inflation Revisited: The Role of Financial Innovation and Household Heterogeneity Staff working paper 2018-40 Shutao Cao, Césaire Meh, José-Víctor Ríos-Rull, Yaz Terajima We document that, across households, the money consumption ratio increases with age and decreases with consumption, and that there has been a large increase in the money consumption ratio during the recent era of very low interest rates. We construct an overlapping generations (OLG) model of money holdings for transaction purposes subject to age (older households use more money), cohort (younger generations are exposed to better transaction technology), and time effects (nominal interest rates affect money holdings). Content Type(s): Staff research, Staff working papers JEL Code(s): E, E2, E21, E4, E41 Research Theme(s): Monetary policy, Inflation dynamics and pressures, Real economy and forecasting
August 15, 2013 Bank of Canada Review - Summer 2013 This special issue discusses tools used at Bank of Canada to conduct current analysis - the collection and analysis of a broad spectrum of information to form a view of current economic activity. This analysis is a key input into the Bank’s monetary policy decision-making process. Content Type(s): Publications, Bank of Canada Review
January 10, 2011 Household Finances and Economic Growth Remarks Agathe Côté Canadian Club of Kingston Kingston, Ontario Why does household financial health matter to the Bank of Canada? It matters because how Canadians spend and how much they spend affect both the conduct of monetary policy and the stability of the financial system. Content Type(s): Press, Speeches and appearances, Remarks
March 30, 2006 The Evolving International Monetary Order and the Need for an Evolving IMF Lecture David Dodge Woodrow Wilson School of Public and International Affairs Princeton, New Jersey The world needs an international institution to promote a new monetary order—a well-functioning, market-based global financial system. This will be the subject of my remarks today. Content Type(s): Press, Speeches and appearances, Lectures
How to Manage Macroeconomic and Financial Stability Risks: A New Framework Staff analytical note 2018-11 Alexander Ueberfeldt, Thibaut Duprey Financial system vulnerabilities increase the downside risk to future GDP growth. Macroprudential tightening significantly reduces financial stability risks associated with vulnerabilities. Monetary policy faces a trade-off between financial stability and macroeconomic risks. Content Type(s): Staff research, Staff analytical notes JEL Code(s): E, E4, E44, E5, E52, E58, G, G0, G01 Research Theme(s): Financial system, Financial stability and systemic risk, Financial system regulation and oversight, Models and tools, Economic models, Monetary policy, Monetary policy framework and transmission
December 14, 1999 Trends in Canada's Merchandise Trade Bank of Canada Review - Winter 1999–2000 Richard Dion The author examines aspects of Canada's trade performance in light of the major trends seen in world trade over the past several decades. Canada has become more integrated with the world economy, and this openness is evident from its greater export orientation, its heavier reliance on imported inputs, and more exposure to foreign competition in its domestic markets. The author analyzes the composition of Canadian trade and the trend towards increasing two-way trade in similar products. He also looks at the increasing integration of trade within regions, which for Canada has meant a greater concentration of exports with the United States. Content Type(s): Publications, Bank of Canada Review articles
Understanding Inflation Dynamics: The Role of Government Expenditures Staff working paper 2023-30 Chang Liu, Yinxi Xie We study the impact government expenditure has on inflation. We find that changes in government expenditure account for a substantial portion of inflation variations. We also find that inflation and inflation expectations respond negatively to fiscal spending shocks, reaffirming the supply-side channel through which inflation responds to fiscal expansions. Content Type(s): Staff research, Staff working papers JEL Code(s): E, E3, E6, E62, E63 Research Theme(s): Models and tools, Economic models, Monetary policy, Inflation dynamics and pressures
December 11, 2012 Guidance Remarks Mark Carney CFA Society Toronto Toronto, Ontario Bank of Canada Governor Mark Carney speaks about central bank policy guidance. Content Type(s): Press, Speeches and appearances, Remarks
Benchmarks for assessing labour market health: 2023 update Staff analytical note 2023-7 Erik Ens, Kurt See, Corinne Luu We enhance benchmarks for assessing strength in the Canadian labour market. We find the labour market remains tight despite recent strong increases in labour supply, including among prime-working-age women. We also assess the anticipated easing in labour conditions in a context of high population growth. Content Type(s): Staff research, Staff analytical notes JEL Code(s): E, E2, E24, J, J2, J21, J6 Research Theme(s): Monetary policy, Real economy and forecasting, Structural challenges, Demographics and labour supply
Decentralized finance: Innovations and challenges Staff analytical note 2023-15 Jonathan Chiu, Hanna Yu Decentralized finance surged in popularity around 2020. We explore its value and limitations and highlight some potential regulatory concerns. Content Type(s): Staff research, Staff analytical notes JEL Code(s): G, G1, G2 Research Theme(s): Financial system, Financial stability and systemic risk, Money and payments, Digital assets and fintech, Payment and financial market infrastructures