Explainers (The Bank of Canada)

Latest explainers

• Breaking down the costs of building new housing
  To make housing more affordable, Canada needs to build more homes. Monetary policy plays an indirect role in increasing housing supply, but it is only one piece of a much larger puzzle. […]
• What does the Bank of Canada do?
  The Bank has five main areas of responsibility that affect Canadians’ everyday lives. […]
• What is a central bank?
  A central bank works to promote a country’s economic stability and its citizens’ financial well-being. […]
• What is money?
  We use money to pay for goods and services. Canadians are using digital money more than ever before, but cash still plays an important role in our economy. […]
• What is gross domestic product?
  Gross domestic product (GDP) is a measure of a country’s total economic output—the total value of all goods and services produced within that country—usually over the course of one year. […]
• The difference between the price level and inflation
  Price levels are a measure of the average cost of goods and services in the economy at a particular point in time. Inflation measures the rate of change in prices over a specific period. […]
• Why we target 2% inflation
  Inflation measures the rate of growth in prices, and the Bank of Canada aims to keep it at 2%. When inflation is low, stable and predictable, the entire economy works better. […]
• What is a flexible exchange rate?
  Canada has a flexible exchange rate. The value of our dollar is not fixed to the value of any other currency or to a precious metal such as gold. […]
• The difference between a trade surplus and a trade deficit
  A trade surplus and a trade deficit are both measures of a country’s balance of trade. They are a calculation of whether a country exports or imports more. […]
• Understanding our policy interest rate
  At the heart of the Bank of Canada’s monetary policy is the target for the overnight rate. See what it is—and what it means for you. […]

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