ECON 1010 Lecture Notes - Lecture 9: Monetary Base
Document Summary
On eight preset dates a year, the bank of canada announced whether the interest rate will rise, fall or remain constant until the next decision date. Canada"s monetary policy objectives and framework for setting and achieving that ob- jective stems from the relationship between the bank of canada and the government of. The objective of monetary policy is ultimately political. It stems from the mandate to the bank of canada, which is set out in the bank of cana- da act 1935. Basically, the bank"s job is to control the quantity of money and interest rates in order to avoid inflation and when possible, prevent excessive swings in real gdp growth and unemployment. Joint statement of the government of canada and the bank of canada. The agreement is: the inflation-control target: 1-3 percent per year, keep trend inflation at the 2% midpoint, the agreement will run for five years, and will be renewed sometime during 2011.
