The Evolution of the Government of Canada's Debt Distribution Framework
This overview includes a brief history highlighting the government's use of the primary and secondary markets to develop a framework for distributing its debt securities to financial market intermediaries and end investors. The framework is also intended to meet the government's debt-strategy objectives of raising stable, low-cost funding and maintaining a well-functioning debt market. Pellerin reviews the government's adoption of a new framework in 1998 as well as the 2005 modifications aimed at attracting continued broad and competitive participation in government auctions.
The overnight market in Canada
The overnight market is an active forum where participants with a temporary surplus or shortage of funds can lend or borrow until the next business day. The level of interest rates in the overnight market has always been closely linked to the Bank of Canada's monetary policy operations. In this article, the authors describe the evolution of the market from its roots in the 1950s, the development of the Bank's monetary policy operations in the market, and how the market operates today. They also examine the outlook for the overnight market, particularly the implications of the new Large-Value Transfer System.
Primary Dealers in Government Securities Markets
This introductory Handbook first describes the main functions of what are commonly called primary dealers in the government securities markets. It sets out the advantages of primary dealer systems to the authorities running these markets (usually the Ministry of Finance and the Central Bank) and explains what the authorities may have to concede to secure the benefits. It analyses which of these considerations may be most relevant in deciding whether or how to develop a system of primary dealers. The analysis would be applicable to any economy, although these questions may currently be most pressing in some of the countries in transition towards a market economy. The Handbook does not specifically deal with the role of financial intermediaries in money markets, as opposed to securities markets, although, particularly in a developing market economy, there may be a fair degree of overlap between these two markets, so that some of the argumentation here could apply equally to the role of specialist financial intermediaries in money markets. This handbook is also available in Russian and Spanish.