01829cas a2200241 a 4500 AALejournalIMF015809 230101c9999 xx r poo 0 0eng d 5.00 USD 9781513509396 1018-5941 BD-DhAAL BD-DhAAL Matheson, Troy. How to Improve Inflation Forecasting in Canada / Troy Matheson. Washington, D.C. : International Monetary Fund, 2019. 1 online resource (22 pages) IMF Working Papers <strong>Off-Campus Access:</strong> No User ID or Password Required <strong>On-Campus Access:</strong> No User ID or Password Required Electronic access restricted to authorized BRAC University faculty, staff and students Against the backdrop of an ongoing review of the inflation-targeting framework, this paper examines the real-time inflation forecasts of the Bank of Canada with the aim of identifying potential areas for improvement. Not surprisingly, the results show that errors in forecasting non-core inflation (commodity prices et cetera) are found to be the largest contributors to overall inflation forecast errors. Perhaps more importantly, relatively small core inflation forecast errors appear to mask large and offsetting errors related to the output gap and the policy interest rate, partly reflecting a tendency to overestimate the neutral nominal policy rate in real time. Faced with these uncertainties, the Governing Council's gradual approach to changing its policy settings appears to have served it well. Mode of access: Internet IMF Working Papers; Working Paper ; No. 2019/190 Full text available on IMF http://elibrary.imf.org/view/journals/001/2019/190/001.2019.issue-190-en.xml IMF e-Library