Bank of Canada
| Headquarters | Ottawa , Canada |
| founding | 1934 (start of business March 11, 1935 ) |
| president | Stephen Poloz |
| country | Canada |
| currency | |
| ISO 4217 | CAD |
| Currency reserves | US $ 82.7 billion (2016) |
| Website | |
| List of central banks | |
The Bank of Canada ( English Bank of Canada , French Banque du Canada ) is Canada's central bank . It was established by the Bank of Canada Act of 1934 to "promote the economic and financial well-being of Canada."
The current statement on their goals reads:
"The Bank of Canada’s responsibility is focused on the goals of low and stable inflation, a safe and reliable currency, financial stability and efficient government bond and debt management."
It is the only agency that issues Canadian banknotes .
Headquarters are at the intersection of Wellington Street and Bank Street in downtown Ottawa .
history
For a long time Canada did not have its own central bank. Each major bank in the country issued its own banknotes, and Canada's cash supply was poorly organized. The Federal Ministry of Finance only issued banknotes in small numbers. The Banque de Montréal , at the time the largest bank in the country, acted as the state bank. With the sophisticated branch banking system, Canada had a very stable banking system. There was little need for a lender of last resort, and the banking system did not suffer from seasonal liquidity problems like US banks .
Although there were some central bank advocates, mostly farmers, the status quo persisted at the beginning of the twentieth century.
This should not change until a Great Recession looms. Many Canadians accused the banks of their behavior accelerating this recession. The money supply dwindled and deflation was the order of the day. Farmers' demand for a central bank has now been supported by manufacturing and other groups. Another advocate was the Royal Bank of Canada , which did not allow its rival, the Bank of Montreal, to do state banking. The government also felt restricted in its options for repaying foreign loans.
Prime Minister R. B. Bennett then appointed a commission in 1931 to recommend the establishment of a central bank. The bank began operations on March 11, 1935, following the passage of the Bank of Canada Act. It was initially set up as a privately owned corporation to ensure its political independence. In 1938, under Mackenzie King , it became a government-owned Crown Corporation and a prime minister appointed director.
The responsibility for issuing banknotes was transferred to it by the Ministry of Finance in 1949 and the private banks were asked to take their banknotes out of circulation. The bank played an important role in funding Canada's war effort during World War II .
She was later given the job of promoting economic growth in Canada. The subsidiary Industrial Development Bank was set up to encourage investment in Canadian companies. The bank's monetary policy has been geared towards low interest rates and full employment with little regard for inflation. When inflation began in the early 1960s, director James Coyne ordered a reduction in the money supply. Prime Minister John Diefenbaker disagreed with this decision and ordered a return to full employment objectives. This caused a brief crisis as the bank was set up as a market economy organization and should not be under political control. Coyne resigned and Louis Rasminsky took over his post.
As a result, the bank focused more on fighting inflation, so that this was proclaimed its primary goal in the 1980s.
director
The head of the Bank of Canada is the director , who is appointed by the board of directors of the bank for a seven-year term. He cannot be fired by the government. In the event of profound disagreements between the government and the bank, the Canadian Treasury Secretary can order in writing that the bank must change its behavior. In practice, the director determines monetary policy independently of the government.
Directors
- Tiff Macklem (since 2020)
- Stephen Poloz (2013-2020)
- Mark Carney (2008-2013)
- David A. Dodge (2001-2008)
- Gordon Thiessen (1994-2001)
- John Crow (1987-1994)
- Gerald Bouey (1973–1987)
- Louis Rasminsk (1961–1973)
- James Coyne (1955-1961)
- Graham Towers (1934-1954)
See also
Web links
- Official website (English, French)
Individual evidence
- ↑ https://www.bankofcanada.ca/profile/stephen-s-poloz/
- ↑ Canada Foreign Exchange Reserves . tradingeconomics.com. Accessed January 30, 2017
- ↑ https://www.bankofcanada.ca/core-functions/monetary-policy/