Toni Gravelle on QE tapering
From Speech by Toni Gravelle / Discours de Toni Gravelle · · BankofCanadaBanqueduCanada
“Moderating the pace of purchases would simply mean we are still adding stimulus through QE but at a slower pace — easing our foot off the accelerator, not hitting the brakes.”
On , Toni Gravelle, Deputy Governor at Bank of Canada, spoke about QE tapering during Speech by Toni Gravelle / Discours de Toni Gravelle on BankofCanadaBanqueduCanada.
About Toni Gravelle
On March 23, 2021, Bank of Canada Deputy Governor Toni Gravelle delivered a speech to the CFA Society Toronto on the Bank's response to market-wide stress during the pandemic. Gravelle described the Bank's actions a year earlier, including increasing the frequency and size of repo operations, lending roughly $200 billion to financial institutions in March and April 2020, and pledging to buy up to $50 billion of provincial bonds and up to $10 billion of corporate bonds. He stated that the Bank's balance sheet had grown to close to $575 billion, more than four times its pre-pandemic level. Gravelle discussed the Bank's approach to quantitative easing, saying that moderating the pace of purchases would mean adding stimulus at a slower pace rather than removing it. He noted that the Bank was building readiness to issue a central bank digital currency but would only consider doing so if there were a sudden drop in cash acceptance or a cryptocurrency became dominant and jeopardized the financial system. Gravelle also stated that the neutral rate of interest was lower than in the past due to demographics and lower productivity, estimating it at around 2.25 percent.