Canada's Murray: 2% inflation target not necessarily optimal
John Murray, a deputy governor of the Bank of Canada, questioned the effectiveness of a 2% inflation target in a speech on Tuesday.
Recent research shows that a lower inflation target could improve pricing behaviour within individual firms and increase the incentive to hold money, he said.
The central bank's research has also shown that typical agents - holding assets such as housing, nominal debt and money - are likely to benefit on aggregate from a reduced inflation target.
Murray also noted
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