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Room for Manoeuvre – Monetary Policy Over the Next Eighteen Months, and the Allure of Price-Level Targeting

  • Philippe Bergevin

    (C.D. Howe Institute)

  • David Laidler

    (C.D. Howe Institute)

Moving to price-level targeting from inflation-rate targeting could be a sound option for the Bank of Canada after 2011, when its current agreement with the Minister of Finance is up for renewal. However, the authors say the viability of that option rests on whether the Bank can maintain its credibility in monetary policy over the coming months, as it seeks a balance between providing support to the still fragile economic recovery and avoiding a resurgence of inflation above its 2 percent inflation target.

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Paper provided by C.D. Howe Institute in its series e-briefs with number 97.

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Length: 5 pages
Date of creation: Apr 2010
Date of revision:
Publication status: Published on the C.D. Howe Institute website, April 2010
Handle: RePEc:cdh:ebrief:97
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