James Smith, developed markets economist at ING, suggests that the monetary tightening by BoC will resume later this year, with core inflation being a key component of the central bank’s hiking rationale.
Key Quotes
“The Bank of Canada will also be keeping a keen eye on the severity of any housing market downturn, trade developments between the US and China, as well as oil prices.”
“Nonetheless, economic fundamentals – such as a strong labour market and on/around-target core inflation, paint a positive picture. If these downside risks don’t materialise, we expect the central bank to hike once (if not twice) this year. “
The next move is most likely to come in the third quarter, allowing time to see how the Federal Reserve acts over the next few months.”
Share
