To raise short-term market interest rates,the Bank of Canada could

Question

Quizplus · Accepted Answer

Increasing the target for the overnight rate is the most direct and effective way for the Bank of Canada to raise short-term market interest rates. It influences the rates at which banks lend to each other overnight, which in turn affects the rates at which they lend to customers. The other options may also affect interest rates, but not as directly or immediately.

To Raise Short-Term Market Interest Rates,the Bank of Canada Could