policy
THE BANK OF CANADA AND A NEW MANDATE IN 2021? Since 1991, Canada’s central bank has made it almost a singular goal to ensure consumer prices increase predictably and slowly (ideally 2% per year). While
associated with low unemployment rates, which in turn are associated with higher inf lation—the Bank could adopt into policy these two goals just as the United States, Australia, and New Zealand already have. One option for the Bank would be to move to average inf lation targeting instead of specific inf lation targeting, meaning as long as inf lation averaged something like 2% over a period of time, the Bank wouldn’t increase interest rates (which would tend to reduce employment). Regardless of its chosen path, the Bank of Canada will play a leading role in the country's ability to recover from the Great Suppression.
functioning outside of the politics of Ottawa from an operational perspective, the Bank does consult with the federal government periodically as part of its mandate review and renewal. The next five-year agreement between the federal government and the Bank of Canada will renew in 2021, and there is much discussion about whether the Bank should pursue a dual mandate: that is to manage inf lation and to pursue full employment. While there is a certain incompatibility between these goals—full employment is CMHC: A CHANGE IN NAME AND IN MANDATE The Canada Mortgage and Housing Corporation (CMHC) is a Canadian crown corporation that has been around for a long time, having been created in 1946 with a goal of making housing more affordable across the country. Today, the organization provides mortgage loan insurance for buyers, collects data and provides analyses on the housing market, assists in the development of First Nation housing, and has helped to develop Canada’s National Housing Strategy.
In light of the multitude of functions it performs, the fact that its mandate going forward will focus on providing all Canadians with homes they can afford by 2030, and in acknowledgement that its current name too closely frames it as a financial institution, CMHC expects to adopt a new moniker in the coming months.
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