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Previewing the Bank of Canada’s (BoC) Business Outlook Survey (BOS) that will ve released on October 22nd, “We see a mixed backdrop for Tuesday’s BOS; positive GDP forecast revisions should support future sales, but elevated trade uncertainty will weigh on investment intentions,” said TD Securities analysts.  “Softer inflation expectations would also raise concerns though recent strength in CPI should limit this risk. Overall, the BOS is unlikely to make a strong case for a near-term cut, keeping the focus on 2020.”

Key quotes on next week’s events

“Recent polls are tilted heavily towards a minority, with the Liberals and Conservatives in a virtual tie. Should neither party win a majority, the government will need to rely on ad-hoc arrangements to survive confidence motions. However, if neither party can viably govern, it would open the door to a formal coalition or a hasty return to the polls.

“TD looks for a 0.6% increase in retail sales for August with motor vehicles driving the move after a new record for preliminary light truck sales and several months of robust labour market gains. Gasoline prices will exert a modest headwind while a broader pullback in consumer goods prices should allow real retail sales to outpace the nominal gain.”