BoC to maintain a dovish tone - NBF

Analysts at National Bank Financial, suggest that BoC’s monetary policy meeting will be the highlight of the week.

Key Quotes

“In our opinion the Bank’s latest Monetary Policy Report is likely to show a greater gap than previously estimated, allowing the BoC to maintain a dovish tone this time. That stance should be reinforced by the recent deterioration in global economic indicators and falling commodity prices. Based on theses these developments, we expect the BoC to remain on the sidelines for the next six months at least.”

“The week will also provide some important information about the state of the housing market with the publication of November’s building permits and December’s housing starts. The latter may have totaled 225K in seasonally adjusted annualized terms if, as we believe, groundbreakings for multis rose to a level more in tune with the growing number of permits granted in this category in recent months.”

“We’ll also get data on November’s merchandise trade balance. Exports may have suffered from lower commodity prices in the month, putting pressure on the overall goods balance.”