Canada's approach to monetary policy

Abstract

The ultimate goal of Canadian monetary policy is maintaining a low, stable rate of inflation in order to foster efficient economic performance and a rising standard of living for Canadians. More specifically, the Bank of Canada aims to keep inflation inside a target range of 1 to 3 percent. This range, established jointly with the federal government, was first announced in 1991 and has been extended through the end of 2006. Over the medium term, the target applies to total CPI. The Bank also uses a core CPI measure as a guide to future inflation developments over the shorter term. The Bank of Canada's operational target is the overnight rate, which is set at the midpoint of a 50 basis point operating band.Monetary policy - Canada ; Bank of Canada ; Banks and banking, Central - Canada