Stress testing, at its most general level, is an investigation of the performance of an entity under abnormal operating conditions. The authors focus on one set of entities--the Canadian banking sector--and investigate losses in the loans portfolio of this sector as a function of changing...

This paper discusses policies that monetary policy authorities could implement in response to a generalized and persistent decline in goods and services prices. The authors argue that in such situation the priority should be to defend the credibility of monetary policy. They differentiate...

Over the last few years, many countries have adopted inflation targets. The objective of this paper is to report some empirical results that bear on the link between the adoption of inflation targets and the behaviour of the main macroeconomic variables. After a discussion of some recent...

This paper explores the extent to which factors other than commodity and energy prices may have contributed to the Canadian dollar's depreciation since the early 1970s. The variables considered include among others budgetary conditions and productivity. The approach involves a long-term...

In this article, we discuss the recent literature analyzing the experience of countries having adopted inflation targets and provide some simple statistical tests for determining the link between the adoption of inflation targets and the credibility of monetary policy. The literature survey and...