ECON 304 Lecture Notes - Federal Reserve Act, Federal Open Market Committee, Federal Funds Rate
21 Apr 2013
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Document Summary
The objective of monetary policy in canada is very clear. It is to target in ation at 2% around a band that can vary between 1 and 3 per cent. The overnight rate is the main instrument that the. Bank of canada uses to implement monetary policy. But as we have seen in the previous lecture, the bank of canada has recently used other (unconventional) tools during the nancial crisis. In the previous lecture, we also had an overview of how monetary policy is conducted at the bank of canada and some of the indicators/data that the bank of canada uses in the formulation of monetary policy. We nish our description of monetary policy by providing an overview of how the federal reserve is organized in the united states, how it conducts monetary policy and the in uence u. s monetary policy has on canada. The federal reserve system (the fed) was established by an act of congress in 1913.
