September 12, 2001 Government of Canada treasury bill and Real Return Bond auctions rescheduled In light of the tragic circumstances that occurred in the U.S. yesterday that continue to disrupt trading activity in North American markets, the Government of Canada in conjunction with the Bank of Canada is making the following Debt Management announcements: Content Type(s): Press, Market notices
September 11, 2001 Bank of Canada statement Media Relations In light of the tragic events in the United States, the Bank of Canada would like to assure the public that it will provide the liquidity necessary to support the stability of the Canadian financial system and the continued functioning of financial markets. Content Type(s): Press, Press releases
September 11, 2001 Government of Canada treasury bill auction and Cash Management Buyback scheduled to be held today are postponed and cancelled respectively In light of extraordinary circumstances that have occurred in the U.S. today that have significantly disrupted trading activity, the Government of Canada in conjunction with the Bank of Canada are making the following Debt Management announcements: Content Type(s): Press, Market notices
L'effet de la richesse sur la consommation aux États-Unis Staff Working Paper 2001-14 Yanick Desnoyers The substantial growth in wealth over the course of the second half of the 1990s generated the equivalent of a certain level of savings, while simultaneously causing household savings rates to fall significantly. The author seeks to explain this decline in savings, observed since 1995, using the methodology developed by King, Plosser, Stock, and Watson (1991). Content Type(s): Staff research, Staff working papers Topic(s): Domestic demand and components JEL Code(s): E, E2, E21
August 28, 2001 Bank of Canada lowers key policy interest rate by 1/4 percentage point to 4 per cent Media Relations Ottawa, Ontario The Bank of Canada today announced that it is lowering its target for the overnight rate* by one-quarter of one percentage point to 4 per cent. The operating band for the overnight rate is correspondingly lowered, and the Bank Rate is now 4 1/4 per cent. With today's action, the total reduction in interest rates by the Bank this year amounts to 1 3/4 percentage points. Content Type(s): Press, Press releases
August 17, 2001 The Changing Effects of Energy-Price Shocks on Economic Activity and Inflation Bank of Canada Review - Summer 2001 Gerald Stuber In this article the author examines the effects that major changes in energy prices in recent years have had on inflation and on the pace of economic expansion. These are then compared with the effects of the oil-price shocks that occurred in the 1970s and early 1980s. Changes in the intensity of energy use are examined, as well as developments in Canada's merchandise trade surplus in energy commodities and products. The author also considers the effects that a monetary policy anchored to low and stable inflation could have on price-setting behaviour and thus on the pass-through of higher energy costs to core inflation in Canada and in other industrial countries. Content Type(s): Publications, Bank of Canada Review articles Topic(s): Business fluctuations and cycles
August 17, 2001 Bank of Canada Review - Summer 2001 Cover page Trade Silver The objects featured on the cover range in size from 1 to 2.5 inches in width. They form part of the National Currency Collection, Bank of Canada. Photography by James Zagon. Content Type(s): Publications, Bank of Canada Review
August 16, 2001 Innovation and Competition in Canadian Equity Markets Bank of Canada Review - Summer 2001 Serge Boisvert, Charles Gaa Innovations in communications and information technology and the related globalization of financial markets have created the potential for important changes to the structure of Canadian equity markets. Established marketplaces can now compete more effectively on an inter-regional and international basis. At the same time, reduced costs have lowered the barriers to entry faced by new competitors known as alternative trading systems (ATSs). In response to this heightened competition, established Canadian stock exchanges have taken measures to improve market quality. While regulators see innovation as positive for the development of Canadian markets, there is some concern that market liquidity may be fragmented in the short run. The Canadian Securities Administrators have proposed a framework that attempts to address this issue and that would allow ATSs to compete with traditional exchanges for the first time. The authors provide an overview of the Canadian equity market and its structure, focusing on these recent developments. Content Type(s): Publications, Bank of Canada Review articles Topic(s): Financial markets
August 15, 2001 Analyzing the Monetary Aggregates Bank of Canada Review - Summer 2001 Dinah Maclean In recent years, the Bank has put renewed emphasis on analyzing monetary variables and on developing models that incorporate money as an active part of the transmission mechanism. In this article, Dinah Maclean describes how the monetary aggregates are used in the formulation of monetary policy analysis at the Bank, outlining the key tools and models used. The most important money-based model currently in use is the M1-VECM. In this model, deviations in the money supply from the long-term demand for money cause changes in inflation. The author briefly describes the "active-money" paradigm underlying this model and explains the key equations within it. Other simpler empirical models are also outlined, including single-equation indicator models for output based on the narrow aggregates, a neural network, and a model based on the broader aggregate M2++. A detailed technical annex provides details on model equations and coefficient values. Content Type(s): Publications, Bank of Canada Review articles Topic(s): Monetary aggregates
August 10, 2001 Proposed Terms and Conditions for Auctions of Receiver General Cash Balances On behalf of the Minister of Finance, the Department of Finance and Bank of Canada are releasing today draft terms and conditions for participation in Receiver General auctions. These auctions are the means by which the government invests its short-term Canadian dollar cash balances. Content Type(s): Press, Market notices