#USDCAD @ 1.31837 : BoC’s 75 bps hike unlikely to impress the loonie – Commerzbank
…
This is a premium post.
[s2If !current_user_can(access_s2member_level4)]Please register for PREMIUM VERSION HERE to read full post below containing analysis. In case of any error or you think you are not able to read the full post below, please email us at support#nehcap.com [lwa][/s2If] [s2If current_user_can(access_s2member_level4)]
The Bank of Canada (BoC) is generally expected to hike its key rate by a further 75 bps. However, the loonie is unlikely to profit from such a staggering move, in the opinion of economists at Commerzbank.
“It will yet have to become clear whether the BoC’s plan of a soft landing will work out and whether it will avoid the risk of a wage-price spiral. If inflation expectations consolidate at higher levels higher rate hikes would probably be required to weaken price pressure – which would make more pronounced effects on the economy more likely.”
“A rate hike of the expected magnitude is unlikely to impress the loonie much today. Whether it will be able to benefit at least short-term depends on how hawkish the statement seems to the market and whether it contains signals for further rate steps.”
See – BoC Preview: Forecasts from eight major banks, hiking rates again
[/s2If]
Join Our Telegram Group
