Below are some of the key highlights from the text of a scheduled speech by the BoC Governor Stephen Poloz at the Chartered Financial Analyst Society Breakfast Seminar in Toronto.
“¢ The pace of increases remains ‘decidedly data dependent’.
“¢ Repeats that neutral is ‘in the neighbourhood’ of 2.50-3.50% (1.75% is the current rate).
“¢ Continues to judge rates need to rise into neutral range.
“¢ Signing USMCA will likely support investment rebound.
“¢ Credit growth and strong demand show housing market is stabilizing.
“¢ WCS discount has narrowed but spreading to light crude.
“¢ Painful adjustment already developing for Western Canada.
“¢ Data released since Oct MPR “have been on the disappointing side”.
“¢ The economy has less momentum heading into Q4 than expected.
“¢ Much of BOC’s deliberations were focused on oil, prices well below MPR projections and demand could be hit by moderating global growth and trade tensions.
“¢ The main risk to the outlook is trade tensions between the US and other nations, says containing inflation risks would be paramount in an outright trade war.
“¢ Many highly-indebted countries will face difficult adjustment as mortgages reset and rates go up.
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