The George Davis Report: May 2019 Edition

By George Davis
Published May 15, 2019 | 3 min watch

A monthly video series on the trajectory of the Canadian dollar

In this edition of the George Davis report, George discusses the implications from the Bank of Canada’s recent interest rate decision and the impact on the Canadian dollar.


What you need to know


Weaker business sentiment suggests that capacity pressures are receding in response to global trade uncertainty .


The resulting widening in the output gap has caused the Bank of Canada to shift to a purely neutral policy stance.


An expected rebound in H2 2019 growth will not necessarily be enough to cause the Bank of Canada to hike rates .


This growth would have to be accompanied by evidence of rising price pressures that would push inflation sustainability above their target .


We do not see the scope for sustained CAD appreciation at this juncture, as trade uncertainty, weak growth in H1 and the widening output gap will prevent Bank of Canada from raising rates .

Hedging Strategies



1.3200 – 1.3300


1.3600 – 1.3700

This video is part of our monthly George Davis Report series, with ad hoc reports brought to you as current.

© RBC Capital Markets, LLC, RBC Dominion Securities Inc., RBC Europe Limited 2018 

George Davis
Chief Technical Strategist, FX Trading, Strategy & Sales, RBC Capital Markets

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