BoC is seemingly unimpressed by recent strong economic releases - Westpac

According to Richard Franulovich, Research Analyst at Westpac, the BoC is seemingly unimpressed by recent strong updates on trade, GDP and the jobs market, preferring to focus on low core inflation and “material” excess capacity in the economy.

Key Quotes

“The BoC statement ends with a neutral bias but there’s no doubt the risks favour an easing before a tightening.”

“The BoC’s dovish leaning along with rising Fed hike odds suggest a break below 1.30 remains a bridge too far.”

“Yield spreads confirm a break toward 1.36-1.38 remains the greater risk while energy prices point at best to a flat near term USD/CAD profile.”