Daniel Trefler Re-appointed As C.D. Howe Institute Research Fellow
William Robson, President and CEO of the C.D. Howe Institute, announces the re-appointment of Daniel Trefler as a Research Fellow. “Dan’s work on trade, competitiveness and productivity growth yields many…Bank of Canada’s unprecedented actions mean there may be inflation ahead – Financial Post Op-Ed
The Bank of Canada’s rate announcement last week — no change — was no surprise. But the effects of its asset purchases could be. The Bank had already lowered the target rate to its effective lower bound of 0.25 per cent, so a further cut was not expected. The Bank didn’t say so but the rate may stay where it is for a while.
The Bank did discuss expansions to quantitative easing (QE), however. How QE will play out for monetary policy, and especially the inflation target, is cause for concern. In its Monetary Policy Report and subsequent press conference, the Bank emphasized that its actions to date have been oriented towards supporting the smooth functioning of financial and credit markets. A focus on financial stability at a time…
Paul Jenkins – In Praise Of Imprecision
From: Paul Jenkins To: Monetary Policy Watchers Date: April 22, 2020 Re: In Praise of Imprecision For the first time since 9/11, the Bank of Canada, with the release of its latest monetary policy report last week, opted not to present a base-case projection for the Canadian economy. The omission was noteworthy, but appropriate, as […] Baker, Bloom, Davis, Terry – Covid-induced Economic Uncertainty
From: Scott Baker, Nick Bloom, Steven J. Davis and Stephen J. Terry To: Canadians concerned about COVID-19’s economic impact Date: April 22, 2020 Re: COVID-Induced Economic Uncertainty Major uncertainties surround almost every aspect of the COVID-19 pandemic from the virus itself to the human toll to the economic recovery. The tremendous speed of the shock makes assessing the macro-economic […] Hodgson, Robson – Some Principles For An Economic Restart
From: Glen Hodgson and William B.P. Robson To: Canadians concerned about COVID-19’s economic impact Date: April 21, 2020 Re: Some principles for an economic restart We have learned a great deal over the past month about the interaction between the coronavirus pandemic and the economy. This is a recession unlike any other, driven by a forced supply-side […] Bishop, Shaffer – As Electricity Demand Sinks, Ontario Power Costs Rise 24 Percent With More To Come
From: Grant Bishop and Blake Shaffer To: Greg Rickford, Ontario Minister of Energy, Northern Development and Mines Date: April 21, 2020 Re: As electricity demand sinks, Ontario power costs rise 24 percent with more to come Many Ontario businesses can expect a surge in their power bills even with the pandemic driven fall in demand […] What happens to the health system after COVID-19? – Toronto Star Op-Ed
The weekend brought good news and early signs the COVID-19 curve may be flattening. The number of new cases has slowed and the numbers of COVID-19 patients hospitalized and in the ICU have stabilized.
Current ICU utilization remains well under the best-case scenario projections, and while it’s still early, it appears likely that we will not have the same surge that overwhelmed New York and Italy.
Canada has avoided the fate of other jurisdictions through strong public health measures and physical distancing. Flattening the curve has involved shutting down or moving large portions of our society online: schools, universities, retail, and the justice system.
In the healthcare sector non-emergency ambulatory care was…
Risk Management Approach Integral to Back-to-Work Strategy: Crisis Working Group on Household Income and Credit Support
April 20, 2020 – Governments must employ a risk management approach to facilitate a gradual reopening of the economy, says the C.D. Howe Institute’s Crisis Working Group on Household Income and Credit Support.
At their April 14 meeting, members agreed that ending the lockdowns and restarting the economy will require a risk management approach on the part of governments, as they balance imperatives related to public health, healthcare utilization, the economy and public finance. Members also recognized that industry can play an enormous role in offering a way forward in the return-to-work strategy.
Best practices surrounding the reopening of the economy should include:
Cooperation across governments in…Don Drummond – Debt Could Choke A Post-covid-19 Economic Recovery
From: Don Drummond To: Bill Morneau, Minister of Finance Date: April 20, 2020 Re: Debt Could Choke a Post-COVID-19 Economic Recovery Canadian public policy is understandably focusing on mitigating the near-term losses the shutdown associated with COVID-19 is causing to employment, income and business. And high marks must be assigned to the swiftness and breadth of action and the […] How to help the provinces weather the COVID-19 economic shock – Financial Post Op-Ed
Since the COVID-19 crisis began, yield spreads for provincial 10-year bonds over equivalent federal debt have increased by about 100 basis points across all provinces. Some provinces — Newfoundland, for example — are in even worse shape. To ease funding pressures on the governments that are on the front line in health care and social assistance we need a two-pronged approach in which the Bank of Canada addresses disruption in the debt markets, and an overhauled federal fiscal backstop helps provinces still in need.
The Bank of Canada is already providing liquidity to the provinces by purchasing short-term provincial debt, thus helping alleviate rollover concerns. It has also embarked on a large-scale asset purchase program —…
Canada Needs Playbook for Restarting Economy: C.D. Howe Institute Crisis Working Group on Business Continuity and Trade
April 17, 2020 – Canada needs firm principles and timelines for a graduated return to work, according to a new report from a C.D. Howe Institute Crisis Working Group.
At its latest meeting on Tuesday, April 14, the Working Group on Business Continuity and Trade discussed the need for a “playbook” to restart Canada’s economy, the implementation of supports for businesses to “bridge” the present shutdown, and the importance of continued investment in robust telecommunications infrastructure to meet the current surge in demand.
The group of economists and industry experts is co-chaired by Dwight Duncan, Senior Strategic Advisor at McMillan LLP and former Ontario Minister of Finance, and Jeanette Patell, Vice-President of…
Ken Boessenkool – Three Ways To Treat The Cerb In Social Assistance
From: Ken Boessenkool To: Canada’s finance ministers Date: April 17, 2020 Re: Three Ways to Treat the CERB in Social Assistance Canada’s social safety net has evolved slowly and carefully in an overlapping federal system of transfers and benefits. Ottawa has responsibility for the tax system and Employment Insurance (EI). The provinces have primary responsibility for most social […]