E4 - Money and Interest Rates
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Real Return Bonds, Inflation Expectations, and the Break-Even Inflation Rate
According to the Fisher hypothesis, the gap between Canadian nominal and Real Return Bond yields (or break-even inflation rate) should be a good measure of inflation expectations. -
Financial Market Imperfection, Overinvestment, and Speculative Precaution
The author uses panel data to assess the sensitivity of investment to cash flow in non-financial firms, taking into account the role their financial health plays in investment decisions. -
Money Demand and Economic Uncertainty
The author examines the impact of economic uncertainty on the demand for money. -
Convergence of Government Bond Yields in the Euro Zone: The Role of Policy Harmonization
Since the early 1980s, long-term government bond yields in the euro zone have declined, in line with those in other industrialized countries. -
Financial Conditions Indexes for Canada
The authors construct three financial conditions indexes (FCIs) for Canada based on three approaches: an IS-curve-based model, generalized impulse-response functions, and factor analysis. -
Exchange Rate Pass-Through and the Inflation Environment in Industrialized Countries: An Empirical Investigation
This paper investigates the question of whether a transition to a low-inflation environment, induced by a shift in monetary policy, results in a decline in the degree of pass-through of exchange rate movements to consumer prices. -
The Demand for Money in a Stochastic Environment
The author re-examines the demand-for-money theory in an intertemporal optimization model. The demand for real money balances is derived to be a function of real income and the rates of return of all financial assets traded in the economy. -
Bank Capital, Agency Costs, and Monetary Policy
Evidence suggests that banks, like firms, face financial frictions when raising funds.