Analysts at TD Securities are expecting the Bank of Canada to hold the overnight rate steady at 1.75% this week, which is already fully priced into markets.
Key Quotes
“The Bank will have to acknowledge recent developments in the energy sector and financial markets, but will try to strike a balanced tone as the longer term forecast is largely intact (we expect just modest downward revisions to 2019 growth). We look for Poloz to reiterate that the policy rate will need to move back to the neutral range – depending on the data, of course.”
“If the Bank succeeds in striking a balanced tone, we look for a short-lived and modest move higher in front-end rates. Markets will not fully recommit to rate hikes in Canada while pricing in cuts in the US.”
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