IDEAS home Printed from https://ideas.repec.org/a/cpp/issued/v20y1994i4p365-384.html
   My bibliography  Save this article

Canadian Monetary Policy 1989-1993: What Were the Bank of Canada's True Actions in the Determination of Monetary Conditions?

Author

Listed:
  • Daniel Racette
  • Jacques Raynauld

Abstract

During its recent battle against inflation from 1988 to the present, the Bank of Canada has been accused of all the evils that plagued the Canadian economy: high dollar and interest rates, recession, and slow recovery. The purpose of this paper is to analyse the action taken by the Bank during the period from 1989 to 1993 in order to characterize precisely the way monetary policy was conducted during this period. We find that, contrary to what analysts have usually stated, monetary policy actions were far from tight in 1989. However, from 1990 on, the Bank took a series of restrictive actions in order to discipline financial markets giving an undue importance to its objective of orderly markets to the detriment of monetary expansion.

Suggested Citation

  • Daniel Racette & Jacques Raynauld, 1994. "Canadian Monetary Policy 1989-1993: What Were the Bank of Canada's True Actions in the Determination of Monetary Conditions?," Canadian Public Policy, University of Toronto Press, vol. 20(4), pages 365-384, December.
    • Handle: RePEc:cpp:issued:v:20:y:1994:i:4:p:365-384
    as

    Download full text from publisher

    File URL: http://links.jstor.org/sici?sici=0317-0861%28199412%2920%3A4%3C365%3ACMP1WW%3E2.0.CO%3B2-F
    Download Restriction: only available to JSTOR subscribers
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Pierre Duguay & Stephen Poloz, 1994. "The Role of Economic Projections in Canadian Monetary Policy Formulation," Canadian Public Policy, University of Toronto Press, vol. 20(2), pages 189-199, June.
    2. Caramazza, Francesco & Hostland, Doug & Poloz, Stephen, 1990. "The demand for money and the monetary policy process in Canada," Journal of Policy Modeling, Elsevier, vol. 12(2), pages 387-426.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Wong, Edwin & Lucia, Kathlyn & Price, Stephanie & Startz, Richard, 2011. "The changing relation between the Canadian and U.S. yield curves," Journal of International Money and Finance, Elsevier, vol. 30(6), pages 965-981, October.
    2. Champagne, Julien & Sekkel, Rodrigo, 2018. "Changes in monetary regimes and the identification of monetary policy shocks: Narrative evidence from Canada," Journal of Monetary Economics, Elsevier, vol. 99(C), pages 72-87.
    3. Guy Debelle, 1996. "The Ends of Three Small Inflations: Australia, New Zealand and Canada," Canadian Public Policy, University of Toronto Press, vol. 22(1), pages 56-78, March.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Kumar, Saten & Webber, Don J. & Fargher, Scott, 2013. "Money demand stability: A case study of Nigeria," Journal of Policy Modeling, Elsevier, vol. 35(6), pages 978-991.
    2. Duguay, Pierre & Longworth, David, 1998. "Macroeconomic models and policy making at the bank of canada," Economic Modelling, Elsevier, vol. 15(3), pages 357-375, July.
    3. Bruce Montador, 1995. "The Implications of Monetary Policy in Canada," Canadian Public Policy, University of Toronto Press, vol. 21(1), pages 107-120, March.
    4. David Laidler & William B.P. Robson, 2004. "Two Percent Target: The Context, Theory, and Practice of Canadian Monetary Policy since 1991," C.D. Howe Institute Policy Studies, C.D. Howe Institute, number 20041, January.
    5. Tao Zha, 1997. "Identifying monetary policy: a primer," Economic Review, Federal Reserve Bank of Atlanta, vol. 82(Q 2), pages 26-43.
    6. Champagne, Julien & Sekkel, Rodrigo, 2018. "Changes in monetary regimes and the identification of monetary policy shocks: Narrative evidence from Canada," Journal of Monetary Economics, Elsevier, vol. 99(C), pages 72-87.
    7. De la Barra, Victor H. & Marchant, Mary A. & Isinika, Aida C., 1995. "Stabilization Policies And Agricultural Impacts In Developing Countries: The Case Of Bolivia," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 27(1), pages 1-13, July.
    8. Thomas J Carter & Rhys Mendes & Lawrence L Schembri, 2018. "Credibility, Flexibility and Renewal: The Evolution of Inflation Targeting in Canada," RBA Annual Conference Volume (Discontinued), in: John Simon & Maxwell Sutton (ed.),Central Bank Frameworks: Evolution or Revolution?, Reserve Bank of Australia.
    9. Ben Fung & Rohit Gupta, "undated". "Searching for the Liquidity Effect in Canada," Staff Working Papers 94-12, Bank of Canada.
    10. Denise Côté & Doug Hostland, 1996. "An Econometric Examination of the Trend Unemployment Rate in Canada," Staff Working Papers 96-7, Bank of Canada.
    11. David Longworth & Brian O´Reilly, 2002. "The Monetary Policy Transmission Mechanism and Policy Rules in Canada," Central Banking, Analysis, and Economic Policies Book Series, in: Norman Loayza & Klaus Schmidt-Hebbel & Norman Loayza (Series Editor) & Klaus Schmidt-Hebbel (Series (ed.),Monetary Policy: Rules and Transmission Mechanisms, edition 1, volume 4, chapter 13, pages 357-392, Central Bank of Chile.
    12. Benjamin Hunt, 1995. "The effect of foreign demand shocks on the Canadian economy: An analysis using QPM," Bank of Canada Review, Bank of Canada, vol. 1995(Autumn), pages 23-32.
    13. Leo Butler, 1996. "The Bank of Canada's New Quarterly Porjection Model Part 4 : A Semi- Structural Method to Estimate Potential Output : Combining Economic Theory with a Time-Series Filter," Technical Reports 77, Bank of Canada.
    14. Sharon Kozicki, 1999. "How useful are Taylor rules for monetary policy?," Economic Review, Federal Reserve Bank of Kansas City, vol. 84(Q II), pages 5-33.
    15. Paul Jenkins & Brian O'Reilly, 2001. "Monetary Policy and the Economic Well-being of Canadians," The Review of Economic Performance and Social Progress, in: Andrew Sharpe, Executive Director & France St-Hilaire, Vice-President , Research & Keith Banting, Di (ed.), The Review of Economic Performance and Social Progress 2001: The Longest Decade: Canada in the 1990s, volume 1, Centre for the Study of Living Standards;The Institutute for Research on Public Policy.
    16. George A. Kahn & Klara Parrish, 1998. "Conducting monetary policy with inflation targets," Economic Review, Federal Reserve Bank of Kansas City, vol. 83(Q III), pages 5-32.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:cpp:issued:v:20:y:1994:i:4:p:365-384. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Iver Chong (email available below). General contact details of provider: https://www.utpjournals.press/loi/cpp .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.