The Bank of Canada meets later on Wednesday. What can we expect from the bank and the Canadian dollar?
Here is their view, courtesy of eFXdata:
Credit Agricole CIB Research discusses its expectations for the BoC policy meeting. CACIB is long USD/CAD as a quant-based trade targeting a move towards 1.3329.
“The BoC meeting could prove less eventful in comparison to the ECB as we expect the bank to leave its policy parameters unchanged and to make few adjustments to its policy outlook given that the Canadian economy has evolved largely as expected. Where there is potential for CAD volatility around the BoC meeting is if the central bank hints at any changes to its policy making structures following the Fed’s move to AIT,” CACIB notes.
“Risk sentiment is also a strong driver of USD/CAD at the moment and the ongoing weakness in technology stocks risks generating a broader reduction in risk, which would be positive for the trade,” CACIB adds.
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