Crisis underscored risk from credit excesses: Bank of Canada

The 2008-09 crisis and its aftermath have underscored the unique risks that credit-fuelled excesses pose to economies, forcing the Bank of Canada to pay closer attention to financial stability and to be flexible as it pursues its No. 1 goal of keeping inflation tame and reliable, Mark Carney and his policy team said Wednesday. A […]

Putting Rates in Neutral

Neutral isn’t what it used to be—not with the Bank of Canada’s key interest rate anyhow. In the modern era of monetary policy, the neutral policy rate (NPR) has averaged about 4.20%, according to BMO. Today, BMO, TD, CIBC and others say it’s closer to 3.00%…or less. (Economists have lately been ratcheting down their estimates of the NPR.) If you hold […]

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