Don’t miss this month’s edition of the George Davis Report, where George discusses the outcome of the March Bank of Canada meeting.
What you need to know:
The Bank of Canada kept the overnight rate unchanged at 5% at their March meeting, as expected.
While the demand side of the economy continues to respond to prior rate hikes, inflation and wage growth remain too high.
As such, while the BoC feels that policy is restrictive enough to move inflation toward their 2% target, more time will be required to reach that point.
Our base case continues to expect the BoC to begin cutting interest rates in June – but the risks around this call are tilted toward a later hike as opposed to sooner.
Although the BoC message about more time needed before rate cuts materialize helped to prop up CAD, broader-based USD weakness has been a more important factor.
For the trading range:
USD/CAD
Buyers
1.3200/1.3300
Sellers
1.3600/1.3700
