A unbiased organization not tied to any political affiliation or so they say Regulates credit and currency in the best interests of the country.
Role of the Bank
Directory of monetary policy
They control interest rates
Bank of the chartered banks
BMO, CIBC, TD, RBC, Scotiabank. These banks borrow from the bank of canada
Bank of the Federal Government
The government’s budget is stored at the bank of canada
Issuer of Currency
Where the money is printed. Also validates counterfeit currency
Policies
Tight Money Policy
Caused by a shortage of money supply
- High interest rates
- More difficult availability of credit
Easy Money Policy
Caused by a surplus of money supply
- Low interest rate
- Easy availability of credit