20 Jan 2015
What to look at tomorrow in the BoC gathering – Scotiabank
FXStreet (Edinburgh) - According to Camilla Sutton, Chief FX Strategist at Scotiabank, these will be the main points traders should focus on in tomorrow’s BoC meeting:
“Any shift in official policy stance to a slightly more dovish bias. The market is pricing in a 20% probability of an interest rate cut in Canada over the next 12-months; which we think is a bit aggressive”.
“Downward revisions to GDP—the BoC GDP forecasts haven’t been revised to reflect the most recent drop in oil prices and are likely to be revised substantially lower, closer to consensus”.
“Downward revisions to inflation—the forecasts are likely to be revised lower; however the key takeaway will be whether the BoC looks through the impact of oil prices on near-term inflation”.
“Oil prices and how the BoC sees the impact on the economy and what kind of mitigation should be expected from strong U.S. growth and a weakening in CAD”.
“Risks, including to the housing market, oil industry, household debt, and global growth are also important focuses”.
“Any shift in official policy stance to a slightly more dovish bias. The market is pricing in a 20% probability of an interest rate cut in Canada over the next 12-months; which we think is a bit aggressive”.
“Downward revisions to GDP—the BoC GDP forecasts haven’t been revised to reflect the most recent drop in oil prices and are likely to be revised substantially lower, closer to consensus”.
“Downward revisions to inflation—the forecasts are likely to be revised lower; however the key takeaway will be whether the BoC looks through the impact of oil prices on near-term inflation”.
“Oil prices and how the BoC sees the impact on the economy and what kind of mitigation should be expected from strong U.S. growth and a weakening in CAD”.
“Risks, including to the housing market, oil industry, household debt, and global growth are also important focuses”.