ECON 1010 Chapter Notes - Chapter 30: Overnight Rate, Open Market Operation, Foreign Exchange Market
Document Summary
Textbook notes: monetary policy objective, ultimately political stems from the mandate of the bank (bank of canada act, bank of canada act: Describes mandate as: regulating credit and currency in the best interest of the nation, mitigate fluctuations in the general level of everything. Inflation-control target uses the cpi as a measure of inflation. Therefore the bank"s targeted inflation is based on the cpi. Bank also pays attention to core inflation rate (based on eight volatile components: actual inflation. Inflation fluctuates around the target inflation, usually staying within the target range: rationale for an inflation-control target. Critics say focusing on inflation lets unemployment and real gdp go unchecked. If bank of canada reigns in ad to prevent inflation from rising, exports suffer and the economy is put into a recession. Experts in monetary economics and monetary policymaking. Usually economics who previously worked in bank"s policy/research departments: economists: Research economists who write papers on monetary policy.
