The Bank of Canada (BoC) holds its first meeting of the year today. Economists at Commerzbank analyze Loonie’s outlook ahead of the policy announcement.
Will the BoC continue to wait and see?
The actual interest rate decision is unlikely to be particularly exciting at this stage. Instead, the BoC is likely to leave rates unchanged. This should not really surprise the market, even though a small residual probability of a first rate cut is currently priced in.
If the BoC's statement and Governor Tiff Macklem's subsequent meeting with reporters can reassure the market of its continued cautious approach, the CAD should benefit slightly given current market expectations.
However, there is of course a risk that the BoC will not fight market expectations very vigorously. Simply because it knows that it is likely to cut rates in the coming months. Dovish comments are likely to put pressure on the CAD. Although this is not my base case, the probability of this happening is much higher than zero given the advanced state of the interest rate cycle. Anyone who needs to manage CAD risks should keep this in mind
免責事項：本記事で述べられている見解は著者の見解のみであり、Followmeの公式見解を反映するものではありません。Followmeは、提供された情報の正確性、完全性、信頼性について一切責任を負いません。また、書面で明示的に記載されている場合を除き、本記事の内容に基づいて行われたいかなる行動についても責任を負いません。
