The Bank of Canada’s power to influence interest rates has been greatly diminished

VANCOUVER—Changing demographics across the globe—not monetary policy—are the main drivers of low interest rates in many of the world’s largest economies, finds a new study released today by the Fraser Institute, an independent, non-partisan Canadian public policy think-tank. “Monetary policy is having less and less impact on interest rates in developed economies such as Canada because the demographic relationship between borrowers and savers has changed dramatically,” said Dr. Michael Walker, author of Why Are Interest Rates So Low?, a ground-breaking study that develops a new model of how interest rates are determined.