21 Jan 2015
BoC expected to keep rates on hold – BBH
FXStreet (Barcelona) - According to the Research Team at Brown Brothers Harriman, BoC might refrain from cutting interest rates today but might cut growth forecasts.
Key Quotes
“The US dollar is consolidating the sharp gains scored yesterday against the loonie after the weakness in manufacturing sales (November's 1.4% decline was twice the decline expected and the October series decline of 0.6% was nearly doubled in the revision to -1.1%), casts doubt on GDP growth. The disappointing data underscored expectations for a dovish leaning central bank today.”
“The BOC won't cut interest rates, but in the monetary policy statement, it is expected to cut its growth forecasts, and may even suggest that a weaker Canadian dollar is part of the adjustment process.”
“Note that Canada reports retail sales and its latest CPI figures on Friday. Headline inflation is expected to ease (1.6% from 2.0%, but the year-over-year pace of core CPI is expected to tick up to 2.3% from 2.1%).”
Key Quotes
“The US dollar is consolidating the sharp gains scored yesterday against the loonie after the weakness in manufacturing sales (November's 1.4% decline was twice the decline expected and the October series decline of 0.6% was nearly doubled in the revision to -1.1%), casts doubt on GDP growth. The disappointing data underscored expectations for a dovish leaning central bank today.”
“The BOC won't cut interest rates, but in the monetary policy statement, it is expected to cut its growth forecasts, and may even suggest that a weaker Canadian dollar is part of the adjustment process.”
“Note that Canada reports retail sales and its latest CPI figures on Friday. Headline inflation is expected to ease (1.6% from 2.0%, but the year-over-year pace of core CPI is expected to tick up to 2.3% from 2.1%).”