Bank of Canada to maintain a cautious tone next week – RBC

Next week the Bank of Canada (Boc) will meet. Analysts at RBC Capital Markets continue to think the BoC will remain an outsider by holding rates steady.

Key Quotes: 

“The Bank of Canada’s final rate decision of 2019 is the main event. While some 40 central banks having eased monetary policy this year, we continue to think the BoC will remain an outsider by holding rates steady next week. That view was cemented by today’s GDP report, which showed a 1.3% annualized increase in Q3 that was bang-on the BoC’s forecast from October.”

“The BoC is likely to continue to warn of the downside risks from trade tensions (their tone doesn’t swing around as much as market sentiment regarding a trade deal) but firmer capital spending suggests global concerns might not be as persistent a headwind to business investment as feared.”

“The Bank of Canada has emphasized that the health of the household sector will be key to upcoming rate decisions, and in that regard Q3 GDP didn’t raise any red flags.”

“While we expect next Friday’s employment report will be soft (look for election-related hiring in October to be retraced) we’d need a string of weak jobs numbers to become more worried about the household sector.”

“We look for the BoC to maintain a cautious tone next week, but with perhaps a less overtly dovish message than in October when Governor Poloz wasn’t shy about saying a rate cut was debated. Additional insight in that regard will come on Thursday when Deputy Governor Lane will deliver an economic progress report and take questions from the media.”

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.

Feed news

Latest Forex News

Editors’ Picks

GBP/USD off 7-month highs, still firmer as Tories hold the lead

GBP/USD retraces from the new seven-month highs of 1.3180 but remains strongly bid, as weekend polls have reaffirmed a solid lead for PM Johnson's Conservatives. Cable dropped on Friday amid upbeat US data.


EUR/USD steadying above 1.1050 amid upbeat German export data

EUR/USD is trading above 1.1050, attempting a recovery after Germany reported an increase in exports in October. EUR/UDS dropped sharply on Friday amid upbeat US Non-Farm Payrolls and weak German industrial output. 


Forex Today: US-Sino trade tensions prevail, Boris closer to victory, EUR/USD licking its wounds

Trade talks: President Donald Trump has called on the World Bank to stop lending to China, a move that may aggravate tensions, with only six days to go until Washington is set to slap new tariffs on Beijing. Negotiations continue.

Read more

Gold clings to modest gains above $1460 level, lacks follow-through

Gold edged higher on the first day of a new trading week and recovered a part of Friday's post-NFP slide to multi-day lows.

Gold News

USD/JPY in search of a firm direction, stuck in a range above mid-108.00s

USD/JPY was seen oscillating in a narrow band and consolidated last week’s losses. US-China trade uncertainties continued underpinning the JPY’s safe-haven status. Investors now seemed reluctant ahead of the latest FOMC monetary policy update.