BoC: Bias to hike but a cautious approach - Rabobank
|Analysts at Rabobank note that the Bank of Canada raised the policy rate 25bp to 1.50% as was widely expected, while maintaining a cautious tone.
Key Quotes
“We maintain the same view held before this meeting; the BoC has a bias to raise rates and will do so if the market is pricing it in but we doubt data will allow to do so again this year.”
“Headline data may be relatively upbeat but a scratch below the surface unveils a very different picture with consumers being squeezed by higher debt servicing costs and rising cost-push inflation, while we see the outlook for trade and investment as uncertain at best.”
“The BoC revised down its forecast for GDP growth this year by 0.1ppt to 2.0% while revising up the outlook for 2019 by 0.2ppt to 2.2%.”
“The BoC revised up its forecast for CPI inflation this year by 0.1ppt to 2.5% while keeping its 2019 forecast steady at 2.1%.”
“The press conference was more dovish than the statement that accompanied the decision.”
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.