ECON206 Chapter Notes - Chapter 14: Federal Open Market Committee, Open Market Operation, Federal Funds Rate

• School: University of Waterloo
• Department: Economics
• Course: ECON206
• Professor: Derek Stacey

Document Summary

Board of directors: a board with 15 members (including the governor) that is responsible for the management of the bank of canada. Governing council: a council with six members (including the governor) that is responsible for the management of the bank of canada. The bank of canada"s four main areas of responsibility: currency, funds management, financial system, monetary policy. Exchange fund account: the fund that holds canada"s official foreign exchange assets. Base money: the sum of the bank of canada"s monetary liabilities (notes outstanding and bank settlement balances) and coins outstanding. Open market buyback operation s: the bank of canada"s buying or selling of bonds in the open market. Instrument independence: the ability of the central bank to set monetary policy instruments. Goal independence: the ability of the central bank to set the goals of monetary policy. Political business cycle: a business cycle caused by expansionary policies that are pursued prior to an election.