June 4, 2020
Financial markets
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June 4, 2020
Economic progress report: keeping markets working
Deputy Governor Toni Gravelle discusses the Bank’s latest interest rate announcement and explains how efforts to keep financial markets functioning through the COVID-19 crisis will lay a solid foundation for economic recovery -
May 20, 2020
Decisive actions in difficult times
Deputy Governor Timothy Lane talks about the Bank’s decisive actions in response to COVID-19, and how these will help Canadians now and in the future. -
May 20, 2020
Policies for the Great Global Shutdown and Beyond
Deputy Governor Timothy Lane explains how the Bank is helping Canadian households and businesses weather the COVID-19 crisis, and how our actions today are laying a solid foundation for our future economic recovery. -
May 14, 2020
Release of the Financial System Review
Press conference following the release of the Financial System Review. -
May 4, 2020
Bridge to Recovery: The Bank’s COVID-19 Pandemic Response
Senior Deputy Governor Carolyn A. Wilkins discusses measures the Bank has taken to address the COVID-19 pandemic and set the stage for recovery. -
A Simple Method for Extracting the Probability of Default from American Put Option Prices
A put option is a financial contract that gives the holder the right to sell an asset at a specific price by (or at) a specific date. A put option can therefore provide its holder insurance against a large drop in the stock price. This makes the prices of put options an ideal source of information for a market-based measure of the probability of a firm’s default. -
Learning, Equilibrium Trend, Cycle, and Spread in Bond Yields
This equilibrium model explains the trend in long-term yields and business-cycle movements in short-term yields and yield spreads. The less-frequent inverted yield curves (and less-frequent recessions) after the 1990s are due to recent secular stagnation and procyclical inflation expectations. -
Optimal Taxation in Asset Markets with Adverse Selection
What is the optimal tax schedule in over-the-counter markets, e.g., those for corporate bonds? I find that an optimal tax schedule is often non-monotonic. For example, trading of some high-price assets should be subsidized, and trading of some low-price assets should be taxed. -
The Effect of Oil Price Shocks on Asset Markets: Evidence from Oil Inventory News
We quantify the reaction of U.S. equity, bond futures, and exchange rate returns to oil price shocks driven by oil inventory news.