CAD: Poloz and GDP data major event risks - ING
In view of analysts at ING, the focal point of Canadian markets in the week will be BoC Governor Poloz's speech and press briefing on Wednesday.
Key Quotes
“It'll be the first time that we hear from the BoC chief since the central bank's second successive rate hike last month and we wouldn't be surprised to hear greater caution over the prospects of additional near-term tightening. Deputy Governor Lane's comment that officials are "paying close attention" to the economic impact of higher short-term rates and a stronger CAD supports our view of a pause in the BoC's hiking cycle for the remainder of this year. A more cautious Poloz could see the ~70% probability of a December BoC rate hike priced out as markets push back expectations of the next policy move.”
“Domestic data-wise the July GDP release (Friday) may confirm that 3Q economic activity has slowed after an impressive 1H17. This would inject a bit of realism into the domestic economic recovery and support a more cautious policy outlook. We look for a CAD reality check this week, with risks of the USD/CAD retrace pushing up towards 1.2470 (23.6% Fibo level).”
Author
Sandeep Kanihama
FXStreet Contributor
Sandeep Kanihama is an FX Editor and Analyst with FXstreet having principally focus area on Asia and European markets with commodity, currency and equities coverage. He is stationed in the Indian capital city of Delhi.
