The Neutral Rate of Interest in Canada Staff Discussion Paper 2014-5 Rhys R. Mendes A measure of the neutral policy interest rate can be used to gauge the stance of monetary policy. We define the neutral rate as the real policy rate consistent with output at its potential level and inflation equal to target after the effects of all cyclical shocks have dissipated. Content Type(s): Staff research, Staff discussion papers Research Topic(s): Interest rates, Monetary policy transmission JEL Code(s): E, E4, E40, E42, E43, E5, E50, E52, E58
Expansion of Higher Education, Employment and Wages: Evidence from the Russian Transition Staff Working Paper 2013-45 Natalia Kyui This paper analyzes the effects of an educational system expansion on labour market outcomes, drawing upon a 15-year natural experiment in the Russian Federation. Regional increases in student intake capacities in Russian universities, a result of educational reforms, provide a plausibly exogenous variation in access to higher education. Content Type(s): Staff research, Staff working papers Research Topic(s): Development economics, Labour markets JEL Code(s): I, I2, I20, J, J2, J24
Swedish Riksbank Notes and Enskilda Bank Notes: Lessons for Digital Currencies Staff Working Paper 2018-27 Ben Fung, Scott Hendry, Warren E. Weber This paper examines the experience of Sweden with government notes and private bank notes to determine how well the Swedish experience corresponds to that of Canada and the United States. Sweden is important to study because it has had government notes in circulation for more than 350 years, and it had government notes before private bank notes. Content Type(s): Staff research, Staff working papers Research Topic(s): Bank notes, Digital currencies and fintech, Financial services JEL Code(s): E, E4, E41, E42, E5, E58
December 13, 2007 Central Bank Performance under Inflation Targeting Bank of Canada Review - Winter 2007-2008 Marc-André Gosselin Gosselin examines and reports on the various factors that contribute to successful inflation targeting. Using a panel of 21 inflation-targeting countries over the period 1990Q1-2007Q2, Gosselin finds that the ability of central banks to hit their targets varies considerably. Some of these differences can be explained by exchange rate fluctuations, fiscal deficits, and differences in financial development. Others are explained by differences in the targeting framework itself and the manner in which it is implemented. Content Type(s): Publications, Bank of Canada Review articles Research Topic(s): Central bank research, Inflation targets, Monetary policy framework
To Share or Not to Share? Uncovered Losses in a Derivatives Clearinghouse Staff Working Paper 2016-4 Radoslav Raykov This paper studies how the allocation of residual losses affects trading and welfare in a central counterparty. I compare loss sharing under two loss-allocation mechanisms – variation margin haircutting and cash calls – and study the privately and socially optimal degree of loss sharing. Content Type(s): Staff research, Staff working papers Research Topic(s): Economic models, Payment clearing and settlement systems JEL Code(s): G, G1, G19, G2, G21
Effectiveness of Capital Controls in India: Evidence from the Offshore NDF Market Staff Working Paper 2011-29 Michael Hutchison, Gurnain Pasricha, Nirvikar Singh This paper examines the effectiveness of international capital controls in India over time by analyzing daily return differentials in the non-deliverable forward (NDF) markets using the self-exciting threshold autoregressive (SETAR) methodology. Content Type(s): Staff research, Staff working papers Research Topic(s): Econometric and statistical methods, International financial markets, International topics JEL Code(s): F, F3, F31, F32, G, G1, G15
Tariffs and the Exchange Rate: Evidence from Twitter Staff Working Paper 2021-36 Dmitry Matveev, Francisco Ruge-Murcia Do tariffs affect exchange rates? We look at President Trump’s tweets during talks on the North American Free Trade Agreement and find that anticipation of higher tariffs on imports from Canada and Mexico led to an appreciation of the US dollar relative to Canadian and Mexican currency. Content Type(s): Staff research, Staff working papers Research Topic(s): Exchange rates, Trade integration JEL Code(s): F, F1, F13, F3, F31
Money Demand and Economic Uncertainty Staff Working Paper 2004-25 Joseph Atta-Mensah The author examines the impact of economic uncertainty on the demand for money. Content Type(s): Staff research, Staff working papers Research Topic(s): Monetary aggregates JEL Code(s): E, E4, E41, E5, E50
July 21, 2010 Why Monetary Policy Matters: A Canadian Perspective This paper provides a non-technical introduction to monetary policy - what it is, how it works, and why it matters. It discusses inflation volatility and why this is damaging to the economy, as well as why increased stability of output growth is desirable. Content Type(s): Publications, Books and monographs
Information Flows and Aggregate Persistence Staff Working Paper 2009-11 Oleksiy Kryvtsov Models with imperfect information that generate persistent monetary nonneutrality predominantly rely on assumptions leading to substantial heterogeneity of information across price-setters. This paper develops a quantitative general equilibrium model in which the degree of heterogeneity of information is determined endogenously. Content Type(s): Staff research, Staff working papers Research Topic(s): Business fluctuations and cycles, Inflation and prices, Monetary policy transmission JEL Code(s): D, D8, D83, E, E3, E31, E32