BoC's Wilkins - Uncertainty can cause CBs to be more aggressive or more cautious
In a speech to the Money marketeers of New York University, Senior Deputy Governor Carolyn A. Wilkins discusses how uncertainty could affect monetary policy decisions.
Uncertainty can cause central bankers to be more aggressive, as in 2008, or more cautious, like today.
Policy should respond more aggresively to negative shocks when we are near lower bound.
Effective lower bound in Canada is -50 basis points.
In Canada, there is uncertainty about the monetary policy transmission.