E - Macroeconomics and Monetary Economics

• Technology Approach for a CBDC

  Staff Analytical Note 2020-6 Dinesh Shah, Rakesh Arora, Han Du, Sriram Darbha, John Miedema, Cyrus Minwalla

  In this note, we highlight a range of technical options and considerations in designing a contingent system for a central bank digital currency (CBDC) in Canada and explore how these options achieve stated public policy goals.

  Content Type(s): Staff research, Staff analytical notes Topic(s): Central bank research, Digital currencies and fintech JEL Code(s): E, E4, E42, E5, E51, O, O3, O31

• CBDC and Monetary Sovereignty

  Staff Analytical Note 2020-5 Antonio Diez de los Rios, Yu Zhu

  In an increasingly digitalized world, issuers of private digital currency can weaken central banks’ ability to stabilize the economy. By continuing to make central bank money attractive as a payment instrument in a digital world, a central bank digital currency (CDBC) could help to maintain a country’s monetary sovereignty.

  Content Type(s): Staff research, Staff analytical notes Topic(s): Digital currencies and fintech, Monetary policy JEL Code(s): E, E5, E52, E58, F, F5, F55, G, G1, G15

• CBDC and Monetary Policy

  Staff Analytical Note 2020-4 Mohammad Davoodalhosseini, Francisco Rivadeneyra, Yu Zhu

  Improving the conduct of monetary policy is unlikely to be the main motivation for central banks to issue a central bank digital currency (CBDC). While some argue that a CBDC could allow more complex transfer schemes or the ability to break below the zero lower bound, we find these benefits might be small or difficult to realize in practice.

  Content Type(s): Staff research, Staff analytical notes Topic(s): Digital currencies and fintech, Monetary policy, Payment clearing and settlement systems JEL Code(s): E, E4, E41, E5, E51, E52

• The Effect of Mortgage Rate Resets on Debt: Evidence from TransUnion (Part I)

  Staff Analytical Note 2020-2 Katya Kartashova

  This note studies how decreases in mortgage rates affect the behaviour of borrowers in terms of spending on durable goods and repaying debt.

  Content Type(s): Staff research, Staff analytical notes Topic(s): Credit and credit aggregates, Housing, Interest rates, Monetary policy, Monetary policy transmission JEL Code(s): D, D1, D12, D14, E, E4, E43, E5, E52, G, G2, G21, R, R3, R31

• The Power of Helicopter Money Revisited: A New Keynesian Perspective

  Staff Discussion Paper 2020-1 Thomas J. Carter, Rhys R. Mendes

  We analyze money financing of fiscal transfers (helicopter money) in two simple New Keynesian models: a “textbook” model in which all money is non-interest-bearing (e.g., all money is currency), and a more realistic model with interest-bearing reserves.

  Content Type(s): Staff research, Staff discussion papers Topic(s): Credibility, Economic models, Fiscal policy, Inflation targets, Interest rates, Monetary policy, Monetary policy and uncertainty, Monetary policy framework, Monetary policy transmission JEL Code(s): E, E1, E12, E4, E41, E43, E5, E51, E52, E58, E6, E61, E63

• Characterizing Breadth in Canadian Economic Activity

  Staff Analytical Note 2020-1 Taylor Webley, Carla Valerio, Maureen MacIsaac

  Real growth in gross domestic product tends to be meaningfully higher when a large share of industries and demand components are growing—that is, when growth is broad across many fronts.

  Content Type(s): Staff research, Staff analytical notes Topic(s): Business fluctuations and cycles JEL Code(s): E, E3, E32