Issues to be addressed include sound market infrastructure, product standardization and transparency, counterparty relationships, and countercyclical macroprudential tools such as countercyclical capital buffers. Work on these issues represents a multi-year investment at home and abroad.
The Bank is undertaking research and analysis in a number of areas, including how to mitigate procyclical behaviour in the financial system, what is required to keep core funding markets continuously open, and models to stress test the Canadian financial system and gain insights into its functioning.