May 4, 2023
Inflation and prices
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May 4, 2023
Staying the course to price stability
Governor Tiff Macklem explains how monetary policy is working to bring inflation down and outlines the challenges ahead. He also discusses recent stress in the global banking sector and how financial stability and price stability interact. -
Narrative-Driven Fluctuations in Sentiment: Evidence Linking Traditional and Social Media
News media present competing interpretations of what breaking news implies for the macroeconomy. Recent examples include news reporting on high inflation and yield curve inversions. Do these narratives shape macroeconomic sentiment? In this paper, we highlight the importance of narratives using evidence linking traditional media and social media. -
What Consistent Responses on Future Inflation by Consumers Can Reveal
We analyze factors that may explain consistent answers to questions about inflation expectations in the Canadian Survey of Consumer Expectations. We also compare the inflation forecasts of consumers with consistent responses with those of professional forecasters. -
Supply Drivers of US Inflation Since the COVID-19 Pandemic
This paper examines the contribution of several supply factors to US headline inflation since the start of the COVID-19 pandemic. We identify six supply shocks using a structural VAR model: labor supply, labor productivity, global supply chain, oil price, price mark-up and wage mark-up shocks. -
Cost Pass-Through with Capacity Constraints and International Linkages
How are regional cost shocks passed through into global prices? We investigate the role of short-run capacity constraints and show that they can induce stark non-linearities in the pass-through. We highlight this effect for the market for ammonia, a commodity produced largely from natural gas. -
March 9, 2023
Economic progress report: Thinking globally, acting locally
Senior Deputy Governor Carolyn Rogers discusses the Bank’s latest interest rate decision and recent global and domestic developments, including how Canada’s economic and inflation experience compares with other countries. -
March 9, 2023
Understanding the reasons for high inflation
Speaking a day after we decided to hold the policy rate, Senior Deputy Governor Carolyn Rogers talks about the factors behind high inflation and how we know inflation is falling. -
Firms’ inflation expectations and price-setting behaviour in Canada: Evidence from a business survey
Canadian firms’ expectations for high inflation may be influencing their price setting, supporting strong price growth and delays in the transmission of monetary policy. Using data from the Business Outlook Survey, we investigate the reasons behind widespread price growth seen in Canada in 2021 and early 2022. -
Inflation, Output, and Welfare in the Laboratory
We investigate the effect of inflation on output and welfare in the laboratory. Consistent with monetary theory, we find that inflation acts as a tax on monetary exchange and reduces output and welfare.