class 8 Flashcards
when was the central bank created?
it was created by the bank of Canada act in 1934 and started operating in 1935
when was the bank nationalized/ run by the government?
it was a private institutions until 1938
where is the bank of Canadas headquarters?
ottawa
where are the 6 regional offices of the bank of canada?
toronto
Montreal
vancouver
Calgary
Halifax
New York
who makes all of the rules and the budget for the bank of canada?
the board of directors, they meet once a quarter to discuss the rules of the bank and the BoC budget
how many directors does the board of directors for the bank of Canada consist of?
15
what makes up the 15 board members of the bank of Canadas board of directors?
1 governor (also the chief executive officer and chairman of the board of directors)
1 senior deputy governor
1 deputy minister of finance
12 outside directors
does the deputy minister of finance have a vote in the rules and budget of the bank of Canada?
no
how are the outside directors in the board of directors appointed?
they are appointed by the minister of finance with cabinet approval
how long is the term of the outside directors?
they are on a 3 year renewable term
can any other federal agency (dept of finance, dept of defence) make their own budget?
no, only the bank of canada is the only government agency that can create their own budget
how often does the board of directors appoint the governor and senior deputy governor?
the board appoints them with the approval from the government, and they have a renewable term for 7 years
when is the governing council of the bank of canada?
they are the group of people who run the bank and makes decisions on the economy like policy interest rate
how many people are in the governing council?
1 governor (chair)
1 senior deputy governor
4 deputy governors
how often does the governing council make decisions on the policy interest rate?
the make decisions on the overnight rate 8 times a year
what are the 4 functions of the bank of canada?
conduct monetary policy
maintain stability of the financial system
print and distribute currency
funds management for the federal government
what is the heart of monetary policies frame work?
inflation-control target
what is the target for inflation?
2% and the range is 1%-3%
when was the inflation-control target first introduced?
first introduced in 1991 and the target is set jointly by the bank of canada and the federal government and is renewed after every 5 years
how often is the inflation-control target renewed?
every 5 years
what is the bank of Canadas ultimate objective?
the keep inflation low, stable and predictable
what is an example of a monetary policy instrument?
the target for the overnight rate also know as the policy interest rate, this is an instrument that is used to conduct monetary policy
how often does the bank of canada announce its policy rate?
8 times a year
what is the policy rate?
the interest rate at which the banks can borrow from the bank of canada at