How Monetary Policy is made: Two Canadian Tales
We examine policy rate recommendations of the Bank of Canada’s Governing Council (GC) and its shadow, the C.D. Howe Institute’s Monetary Policy Council (MPC). Individual recommendations of the MPC are observed but not those of the GC. Differences in the two committee’s recommendations are small but persistent. The MPC is more responsive to the output gap than its GC counterpart. Both committees respond similarly to inflation. Disagreement within the MPC and with the GC is more likely when rates are rising. Finally, the Bank’s forward guidance had a significant influence on the MPC’s views about the future inflation path.
|Date of creation:||Jul 2014|
|Date of revision:|
|Contact details of provider:|| Postal: |
Phone: +61 2 6125 4705
Fax: +61 2 6125 5448
Web page: http://cama.crawford.anu.edu.au
More information through EDIRC
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- John B. Taylor, 2007.
"Housing and monetary policy,"
Proceedings - Economic Policy Symposium - Jackson Hole,
Federal Reserve Bank of Kansas City, pages 463-476.
- Michael Parkin, 2011. "Overnight Moves: The Bank of Canada Should Start to Raise Interest Rates Now," C.D. Howe Institute Backgrounder, C.D. Howe Institute, issue 139, July.
- Pier Francesco Asso & George A. Kahn & Robert Leeson, 2010.
"The Taylor rule and the practice of central banking,"
Research Working Paper
RWP 10-05, Federal Reserve Bank of Kansas City.
- George A. Kahn, 2012. "The Taylor Rule and the Practice of Central Banking," Book Chapters, in: Evan F. Koenig & Robert Leeson & George A. Kahn (ed.), The Taylor Rule and the Transformation of Monetary Policy, chapter 3 Hoover Institution, Stanford University.
- Matthias Neuenkirch & Pierre L. Siklos, 2014.
"When is Lift-off? Evaluating Forward Guidance from the Shadow,"
Research Papers in Economics
2014-03, University of Trier, Department of Economics.
- Matthias Neuenkirch & Pierre Siklos, 2014. "When is Lift-Off? Evaluating Forward Guidance from the Shadow," Open Economies Review, Springer, vol. 25(5), pages 819-839, November.
- M. Neuenkirch, P. Siklos, 2014. "When Is Lift-Off? Evaluating Forward Guidance From The Shadow," LCERPA Working Papers wm0066, Laurier Centre for Economic Research and Policy Analysis.
- White, Halbert, 1980. "A Heteroskedasticity-Consistent Covariance Matrix Estimator and a Direct Test for Heteroskedasticity," Econometrica, Econometric Society, vol. 48(4), pages 817-38, May.
- Andersson, Malin & Dillen, Hans & Sellin, Peter, 2006. "Monetary policy signaling and movements in the term structure of interest rates," Journal of Monetary Economics, Elsevier, vol. 53(8), pages 1815-1855, November.
- Neuenkirch, Matthias & Siklos, Pierre L., 2013.
"What's in a second opinion? Shadowing the ECB and the Bank of England,"
European Journal of Political Economy,
Elsevier, vol. 32(C), pages 135-148.
- Matthias Neuenkirch & Pierre Siklos, 2011. "What’s in a Second Opinion? Shadowing the ECB and the Bank of England," MAGKS Papers on Economics 201131, Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung).
- Matthias Neuenkirch & Pierre L. Siklos, 2013. "What's in a Second Opinion? Shadowing the ECB and the Bank of England," CAMA Working Papers 2013-46, Centre for Applied Macroeconomic Analysis, Crawford School of Public Policy, The Australian National University.
- Matthias Neuenkirch, 2013.
"Predicting Bank of England’s Asset Purchase Decisions with MPC Voting Records,"
MAGKS Papers on Economics
201322, Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung).
- Matthias Neuenkirch, 2013. "Predicting Bank of England's asset purchase decisions with MPC voting records," Applied Economics Letters, Taylor & Francis Journals, vol. 20(13), pages 1275-1278, September.
- Clarida, Richard H, 2001.
"The Empirics of Monetary Policy Rules in Open Economies,"
International Journal of Finance & Economics,
John Wiley & Sons, Ltd., vol. 6(4), pages 315-23, October.
- Richard Clarida, 2001. "The Empirics of Monetary Policy Rules in Open Economies," NBER Working Papers 8603, National Bureau of Economic Research, Inc.
- EllenE. Meade & David Stasavage, 2008.
"Publicity of Debate and the Incentive to Dissent: Evidence from the US Federal Reserve,"
Royal Economic Society, vol. 118(528), pages 695-717, 04.
- Ellen E. Meade & David Stasavage, 2004. "Publicity of Debate and the Incentive to Dissent: Evidence from the US Federal Reserve," CEP Discussion Papers dp0608, Centre for Economic Performance, LSE.
- Pierre L. Siklos, 2003. "Assessing the Impact of Changes in Transparency and Accountability at the Bank of Canada," Canadian Public Policy, University of Toronto Press, vol. 29(3), pages 279-299, September.
- Pierre L. Siklos, 2009. "As Good As It Gets? The International Dimension to Canada's Monetary Policy Strategy Choices," C.D. Howe Institute Commentary, C.D. Howe Institute, issue 292, July.
- Fujiki, Hiroshi, 2005. "The Monetary Policy Committee and the Incentive Problem: A Selective Survey," Monetary and Economic Studies, Institute for Monetary and Economic Studies, Bank of Japan, vol. 23(S1), pages 37-82, October.
- Michael Parkin, 2009. "What is the Ideal Monetary Policy Regime? Improving the Bank of Canada's Inflation-targeting Program," C.D. Howe Institute Commentary, C.D. Howe Institute, issue 279, January.
- Job Swank & Otto H. Swank & Bauke Visser, 2008. "How Committees of Experts Interact with the Outside World: Some Theory, and Evidence from the FOMC," Journal of the European Economic Association, MIT Press, vol. 6(2-3), pages 478-486, 04-05.
- Richard H. Clarida, 2012. "What Has—and Has Not—Been Learned about Monetary Policy in a Low‐Inflation Environment? A Review of the 2000s," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 44, pages 123-140, 02.
When requesting a correction, please mention this item's handle: RePEc:een:camaaa:2014-53. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Cama Admin)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.