ECON 2000 Chapter Notes - Chapter 12: Open Market Operation, Nominal Interest Rate, Monetary Policy
10 Dec 2016
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Document Summary
The bank of canada was created to analyze the lessons from the great depression. The four tasks of the bank of canada are to: Initially it was a private institution but now it is a crown corporation: conduct monetary policy, regulates financial institutions, issues paper currency. (it does not issue coins, and provides banking services for the feds. It also conducts research on monetary policy and related issues. The board of directors of the bank consist of 12 outsides directors, the governor, the senior deputy governor, and a deputy minister of finance. The governing council consist of the governor, senior deputy governor and the four deputy governors. The most important policy tool used by the bank is the target for the overnight rate. The goal of the bank of canada is price stability. In a market economy, uncertain levels of inflation make prices less useful as signals for resource allocation.
