Inflation Targeting in Canada
C. Freedman, Deputy Governor, Bank of Canada
Dr. Freedman's presentation is based on two papers. The first,"The Canadian Experience with Targets for Reducing and Controlling Inflation," was written in late 1994 and published in 1995 in Inflation Targeting, Leiderman and L. Svensson, eds., Center for Economic Policy Research (http://www.cepr.org). The paper discusses the issues that had to be addressed by the Bank of Canada when it first announced inflation targeting in 1991. The second, "The Framework for the Conduct of Monetary Policy in Canada: Some Recent Developments," is a speech given to the Ottawa Economics Association in January 2000. The speech focuses on some of the recent developments in the framework used by the Bank of Canada, most notably, changes made to increase transparency, the use of monetary conditions index, and the role of monetary aggregates in forecasting. Dr. Freedman will conclude with an assessment of how Canada has benefited from the adoption of inflation targeting.