In recent years the Bank of Canada has made important changes in the way it conducts monetary policy. In particular, the bank has adopted explicit inflation targets and introduced significant changes to its operational framework designed to increase transparency and reduce market uncertainty. This paper examines the key issues associated with the recent changes in the Bank of Canadaas monetary policy framework and analyzes various indicators of central bank credibility.Thus, when the overnight rate moves above the ceiling of the band in a persistent manner, the Bank may intervene to add ... Because the interest rate used in the monetary conditiona#39;s index is a three-month interest rate, the Bank of Canada ... interest rates, even if it does not feel it is necessary to move its overnight range.
|Title||:||The Bank of Canada's Monetary Policy Framework - Have Recent Changes Enhanced Central Bank Credibility? (EPub)|
|Author||:||Takatoshi Ito, Ms. Brenda González-Hermosillo|
|Publisher||:||International Monetary Fund - 1997-12-01|