Bank Of Canada's Monetary Policy

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...The Bank of Canada is indelibly tied to the government's policies meant to fight inflation. It's current policy is based on monetarist policy, particularly that of Hayek, brought in 1987 by Bank of Canada Governor John Crow, formerly of the IMF. von Furstenberg (1998) writes that Crow had successfully implemented economic policies that improved the country's inflation rates. Crow's monetary policy focused on exchange rate determination, money supply factors, inflation rate, and aggregate demand and supply relationships, but only as they relate to price stability and inflation. While Crow's monetary policy was successful in reducing inflation, for his successor, Gordon Thiessen, it has had the opposite effect-inflation has increased, productivity is decreasing, unemployment is rising, and taxes for the lower classes are expected to rise. Canadian economists condemn the maintenance of Crow's monetary policy, especially since the Bank of Canada had announced a more open plan. The problem is that Thiessen reneged on his open policy causing foreign investors to pull out of Canada investments. The result...

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