The Bank of Canada's Monetary Policy Framework: Have Recent Changes Enhanced Central Bank Credibility?

25 Pages Posted: 15 Feb 2006

See all articles by Brenda González-Hermosillo

Brenda González-Hermosillo

International Monetary Fund; Massachusetts Institute of Technology

Takatoshi Ito

University of Tokyo - Faculty of Economics; National Bureau of Economic Research (NBER); Ministry of Finance, Tokyo

Date Written: December 1997

Abstract

In recent years the Bank of Canada has made important changes in the way it conducts monetary policy. In particular, the bank has adopted explicit inflation targets and introduced significant changes to its operational framework designed to increase transparency and reduce market uncertainty. This paper examines the key issues associated with the recent changes in the Bank of Canada's monetary policy framework and analyzes various indicators of central bank credibility.

Keywords: Monetary Policy, Inflation Targeting

JEL Classification: E52, E58

Suggested Citation

González-Hermosillo, Brenda and Ito, Takatoshi, The Bank of Canada's Monetary Policy Framework: Have Recent Changes Enhanced Central Bank Credibility? (December 1997). IMF Working Paper No. 97/171, Available at SSRN: https://ssrn.com/abstract=879349

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