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Trader, analyst and instructor with a 6-year experience

What to expect from the BOC?

Bank of Canada will announce its monetary polcy decision today at 15:00 GMT. That's what economists at major banks expect from the meeting:

HSBC: We expect the Bank of Canada to leave interest rates unchanged at 1.00% for the 25th consecutive announcement. We also expect the Bank to again signal that it has no bias to either hike or cut rates in the short or medium term. Despite inflation having fallen to 0.7% y/y, and thus below the bottom of the Bank of Canada’s 1% to 3% inflation target range, robust auto sales and firm housing markets indicate that key interest-sensitive sectors of the economy do not require additional stimulus.

Barclays: Since any policy changes are highly unlikely, the market will focus on the accompanying statement from the BoC meeting. The previous meeting statement dropped any mention of removing policy stimulus from its guidance and said instead “the substantial monetary policy stimulus currently in place remains appropriate”. We remain underweight CAD however, expecting a grind higher in USD/CAD as relative policy diverges.

Commerzbank: At its meeting on 4 December, the Bank of Canada will keep its policy rate unchanged. The BoC will stick to its view that “considerable” monetary stimulus is necessary. A rate hike will not be on the agenda before 2015.

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