Room for Manoeuvre – Monetary Policy Over the Next Eighteen Months, and the Allure of Price-Level Targeting

Philippe Bergevin and David Laidler
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Philippe Bergevin: C.D. Howe Institute

No 97, e-briefs from C.D. Howe Institute

Abstract: Moving to price-level targeting from inflation-rate targeting could be a sound option for the Bank of Canada after 2011, when its current agreement with the Minister of Finance is up for renewal. However, the authors say the viability of that option rests on whether the Bank can maintain its credibility in monetary policy over the coming months, as it seeks a balance between providing support to the still fragile economic recovery and avoiding a resurgence of inflation above its 2 percent inflation target.

Keywords: Monetary Policy; Bank of Canada; price-level targeting; inflation-rate targeting; exchange rate (search for similar items in EconPapers)
JEL-codes: E31 E42 E52 E58 (search for similar items in EconPapers)
Pages: 5 pages
Date: 2010-04
New Economics Papers: this item is included in nep-cba, nep-mac and nep-mon
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Citations: View citations in EconPapers (10)

Published on the C.D. Howe Institute website, April 2010

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