The Bank of Canada

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The Bank of Canada is Canada’s central bank, whose current Governor is Mike Carney. It was founded in 1934 by the Bank of Canada Act of the same year. The country’s banking system was quite stable even before the Bank of Canada was established, mainly thanks to its branch banking structure, and showed little interest in central banking in the early 1900s. In addition, the banking system was somewhat being regulated by the Canadians Bankers’ Association. However, as the Great Depression took Canada by storm, talks about its then financial state were brewing. Some even questioned the country’s ability to meet larger demands. The bank' class='brand-secondary'>central bank was formed from the Act in 1934, and starting running in 1935, but as a privately owned institution. Then, when William Mackenzie King was re-elected as Prime Minister after a full term by Richard Bennet, the new government made an amendment to the Bank of Canada Act, making the bank publicly owned by 1938, as it is today (Bank of Canada: History). Its primary objective was to be able to support financial and economic wellbeing of our country (Go Currency: Bank of Canada). In that way, it has many roles and functions as a central bank, which I will expand in the coming paragraphs.

To begin with, it is essential to know what the Bank of Canada’s objective is, as stated in the Bank of Canada Act of 1934, even if I’ve briefly mentioned it in the introductory paragraph. In the exact words:

“[…] it is desirable to establish a central bank in Canada to regulate credit and currency in the best interests of the economic life of the nation, to control and protect the external value of the national monetary unit and to mitigate by its influence fluctuations in the general level of production, trade, p...

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...mencé.” Cyberpresse. March 1 2010. La Presse. April 13 2010

“Bank of Canada.” Wikipedia. 13 April 2010

“History.” Bank of Canada. 13 April 2010

Monetary Policy.” Bank of Canada. 13 April 2010

“Backgrounders.” Bank of Canada. April 13 2010

Binhammer, H. H. & Peter S. Sephton. Money, Banking and the Financial System. Nelson, 2001.

(part of Course pack)

“Office of the Superintendant of Financial Institutions.” Wikipedia. 13 April 2010
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