Are Bank Bailouts Welfare Improving? Staff working paper 2021-56 Malik Shukayev, Alexander Ueberfeldt Financial sector bailouts, while potentially beneficial during a crisis, might lead to excessive risk taking if anticipated. Taking expectations and aggregate risk implications into account, we show that bailouts can be welfare improving, but only if capital adequacy constraints are sufficiently tight. Content Type(s): Staff research, Staff working papers JEL Code(s): D, D6, D62, E, E3, E32, E4, E44, G, G0, G01 Research Theme(s): Financial system, Financial institutions and intermediation, Financial stability and systemic risk, Financial system regulation and oversight, Models and tools, Economic models
Technological Progress and Monetary Policy: Managing the Fourth Industrial Revolution Staff discussion paper 2019-11 Stephen S. Poloz This paper looks at the implications for monetary policy of the widespread adoption of artificial intelligence and machine learning, which is sometimes called the “fourth industrial revolution.” Content Type(s): Staff research, Staff discussion papers JEL Code(s): C, C5, E, E3, O, O1, O11, O3, O33 Research Theme(s): Financial system, Financial stability and systemic risk, Models and tools, Economic models, Monetary policy, Monetary policy framework and transmission, Structural challenges, Digitalization and productivity
September 13, 2006 Weathering Economic Shocks: The Importance of Flexibility Remarks Paul Jenkins Vancouver Board of Trade Vancouver, British Columbia First, I should explain what I mean by flexibility. As most of you are surely aware, the Bank of Canada has been openly discussing the importance of promoting policies that support economic efficiency, including financial system efficiency. Efficiency refers to the allocation of scarce economic resources to the most productive uses, in a cost-effective way. Content Type(s): Press, Speeches and appearances, Remarks
Predictive Ability of Commodity Prices for the Canadian Dollar Staff analytical note 2016-2 Kimberly Berg, Pierre Guérin, Yuko Imura Recent sharp declines in commodity prices and the simultaneous depreciation of the Canadian dollar (CAD) relative to the U.S. dollar (USD) have rekindled an interest in the relationship between commodity prices and the CAD-USD exchange rate. Content Type(s): Staff research, Staff analytical notes Research Theme(s): Financial markets and funds management, International markets and currencies, Models and tools, Econometric, statistical and computational methods
November 20, 1997 Monetary Policy Report – November 1997 In the last half-year, the economic expansion in Canada has become well established, supported by low inflation, highly stimulative monetary conditions, and a strong U.S. economy. Content Type(s): Publications, Monetary Policy Report
Channels of Transmission: How Mortgage Rates Affect House Prices and Rents in Canada Staff analytical paper 2026-2 Nishaad Rao, Tao Wang We use Canadian data to examine how monetary policy affects house prices and the consumer price index for rent through exogenous changes in the mortgage interest rates. It finds that the price and rent impacts operate through various channels and that these impacts vary by region. Content Type(s): Staff research, Staff analytical paper JEL Code(s): E, E3, E31, E5, E52, R, R2, R21 Research Theme(s): Monetary policy, Inflation dynamics and pressures, Monetary policy framework and transmission
December 16, 2001 Risk Management in the Exchange Fund Account Bank of Canada Review - Winter 2001–2002 Michel Rochette In this article, author Michel Rochette of the Bank's Risk-Management Unit briefly describes the initiatives undertaken to identify, analyze, model, and manage the principal risks inherent in the transactions of the Exchange Fund Account (EFA), where the international reserves of the federal government are held. The author focuses on five types of risk: credit risk, market risk, liquidity risk, operational risk, and legal risk. In addition, the author presents the risk-management principles underlying the activities of the EFA and the governance structure of the Account. Content Type(s): Publications, Bank of Canada Review articles
Assessing global potential output growth and the US neutral rate: April 2021 Staff analytical note 2021-5 Thomas J. Carter, Xin Scott Chen, Ali Jaffery, Christopher Hajzler, Jonathan Lachaine, Peter Shannon, Subrata Sarker, Graeme Westwood, Beiling Yan We expect global potential output growth to rise to 3 percent by 2022. Relative to the last assessment in October 2020, potential output growth has been revised up across all the regions. The range of the US neutral rate remains unchanged relative to the autumn 2020 assessment. Content Type(s): Staff research, Staff analytical notes JEL Code(s): E, E1, E2, E4, E5, F, F0, O, O4 Research Theme(s): Monetary policy, Monetary policy framework and transmission, Real economy and forecasting, Structural challenges, Demographics and labour supply
April 16, 2014 Monetary Policy Report – April 2014 Economic growth in Canada is expected to average about 2 1/2 per cent in 2014 and 2015 before easing to around the 2 per cent growth rate of the economy’s potential in 2016. Content Type(s): Publications, Monetary Policy Report
The (Un)Demand for Money in Canada Staff working paper 2018-20 Casey Jones, Geoffrey R. Dunbar A novel dataset from the Bank of Canada is used to estimate the deposit functions for banknotes in Canada for three denominations: $1,000, $100 and $50. The broad flavour of the empirical findings is that denominations are different monies, and the structural estimates identify the underlying sources of the non-neutrality. Content Type(s): Staff research, Staff working papers JEL Code(s): C, C3, C31, C36, E, E4, E41 Research Theme(s): Models and tools, Econometric, statistical and computational methods, Money and payments, Cash and bank notes