Bank of Canada adds negative rates to toolkit
Central bank publishes new monetary policy framework when interest rates are low
The effective lower bound on the Bank of Canada's overnight rate is around -0.5%, according to the central bank's "best estimate" – some 75 basis points lower than its last guidance on the topic in 2009.
On December 8, the central bank published a new framework for conducting monetary policy at low interest rates. The three-page document spells out its latest thinking on the tools at its disposal.
In the last document of its kind, published in April 2009, the bank concluded positive interest
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