Blockchain-Based Settlement for Asset Trading Staff working paper 2018-45 Jonathan Chiu, Thorsten Koeppl Can securities be settled on a blockchain and, if so, what are the gains relative to existing settlement systems? We consider a blockchain that ensures delivery versus payment by linking transfers of assets with payments and operates using a proof-of-work protocol. The main benefit of a blockchain is faster and more flexible settlement, whereas the challenge is to avoid settlement fails when participants fork the chain to get rid of trading losses. Content Type(s): Staff research, Staff working papers JEL Code(s): G, G2, H, H4, P, P4, P43 Research Theme(s): Money and payments, Digital assets and fintech, Payment and financial market infrastructures
The BoC-BoE Sovereign Default Database: What’s New in 2019? Staff working paper 2019-39 David Beers, Patrisha de Leon-Manlagnit Until recently, few efforts have been made to systematically measure and aggregate the nominal value of the different types of sovereign government debt in default. To help fill this gap, the Bank of Canada (BoC) developed a comprehensive database of sovereign defaults that is posted on its website and updated in partnership with the Bank of England (BoE). Content Type(s): Staff research, Staff working papers JEL Code(s): F, F3, F34, G, G1, G10, G14, G15 Research Theme(s): Financial markets and funds management, Funds management, Financial system, Financial stability and systemic risk
Monetary Policy in a Volatile World: ToTEM Simulations Staff analytical paper 2026-27 Edward Booth, Edouard Djeutem, Oleksiy Kryvtsov, Fanny McKellips, Yang Zhang Using simulations of the Bank of Canada’s projection model, we assess inflation risks from greater supply-shock volatility and show that monetary policy faces sharper trade-offs, as stabilizing inflation increasingly comes at the cost of weaker real activity. Content Type(s): Staff research, Staff analytical paper JEL Code(s): E, E3, E31, E32, E5, E52, E58 Research Theme(s): Models and tools, Economic models, Monetary policy, Inflation dynamics and pressures, Monetary policy framework and transmission
Options Decimalization Staff working paper 2016-57 Faith Chin, Corey Garriott We document the outcome of an options decimalization pilot on Canada’s derivatives exchange. Decimalization improves measures of liquidity and price efficiency. The impact differs by the moneyness of an option and is greatest for out-of-the-money options. Content Type(s): Staff research, Staff working papers JEL Code(s): G, G1, G14, G2, G20, L, L1, L10 Research Theme(s): Financial markets and funds management, Market functioning, Market structure
May 13, 2014 The Canadian Dollar as a Reserve Currency Bank of Canada Review - Spring 2014 Lukasz Pomorski, Francisco Rivadeneyra, Eric Wolfe This article provides an overview of the growth of Canadian-dollar-denominated assets in official foreign reserves. Based on International Monetary Fund data and on internal Bank of Canada analysis, we estimate that the total reserve holdings of Canadian-dollar assets increased from negligible levels before 2008 to around US$200 billion in the third quarter of 2013. We discuss the determinants of this increase, as well as its potential impact on Canadian debt markets, for example, lower yields and therefore reduced financing costs for the Government of Canada, and the possible negative impact on market liquidity. Content Type(s): Publications, Bank of Canada Review articles JEL Code(s): E, E5, E58, F, F3, F31, G, G1, G12
Data Externalities, Market Power, and the Optimal Design of Central Bank Digital Currencies Staff working paper 2026-21 Yuteng Cheng, Jonathan Chiu, Mohammad Davoodalhosseini, Janet Hua Jiang This paper studies how a central bank should design a CBDC when private payment providers collect and monetize transaction data. It characterizes the optimal CBDC’s pricing and data policy, and shows how its effects on private payment use and total data depend on market power and data externalities. Content Type(s): Staff research, Staff working papers JEL Code(s): G, G2, L, L1, L14 Research Theme(s): Money and payments, Digital assets and fintech, Payment and financial market infrastructures, Retail payments
November 15, 2012 Access, Competition and Risk in Centrally Cleared Markets Bank of Canada Review - Autumn 2012 Jean-Sébastien Fontaine, Héctor Pérez Saiz, Joshua Slive Central counterparties can make over-the-counter markets more resilient and reduce systemic risk by mitigating and managing counterparty credit risk. These benefits are maximized when access to central counterparties is available to a wide range of market participants. In an over-the-counter market, there is an important trade-off between risk and competition. A model of an over-the-counter market shows how risk and competition could be influenced by the incentives of market participants as they move to central clearing. In a centrally cleared market, there may be less risk when participation is high. This helps to explain why regulators have put in place requirements for fair, open and risk-based access criteria. Content Type(s): Publications, Bank of Canada Review articles JEL Code(s): G, G1, G18, G2, G21, L, L1, L13
June 8, 2023 Economic progress report: Are we entering a new era of higher interest rates? Remarks Paul Beaudry Greater Victoria Chamber of Commerce Victoria, British Columbia Deputy Governor Paul Beaudry discusses the latest interest rate decision and suggests reasons why longer-term interest rates could remain higher than they were before the pandemic. Content Type(s): Press, Speeches and appearances, Remarks Subject(s): Monetary policy, Economy/Economic growth, Inflation, Inflation targeting framework
COVID-19 and Financial Stability: Practice Ahead of Theory Staff discussion paper 2022-18 Jing Yang, Hélène Desgagnés, Grzegorz Halaj, Yaz Terajima The COVID-19 pandemic uncovered policy challenges related to the economic measures that were taken to support the economy. Two years later, we attempt to identify the broader impact of these measures and research that needs to follow. Content Type(s): Staff research, Staff discussion papers JEL Code(s): E, E5, E58, E6, E61, G, G2, G21, H, H3, H8, H84 Research Theme(s): Financial system, Financial stability and systemic risk, Financial system regulation and oversight, Household and business credit, Monetary policy, Real economy and forecasting
March 16, 2008 Bank of Canada Review - Spring 2008 Cover Page Canada's First Coinage Photography by Gord Carter, Ottawa. Content Type(s): Publications, Bank of Canada Review