9 July 2019

As a rule, the BoC doesn’t mention currency changes at its rate meeting, but sometimes it happens. The last time they pointed to this issue, was in October 2017, although the increase was larger.

At the same time, the Bank may explain the gain by a strong economic growth. According to the latest data, the economy showed much better results in Q2 than expected. Meanwhile, the U.S. growth was slowing. Canada is also facing a stronger price pressure, and the inflation remains near the BoC’s target 2% for more than a year already.

While most economists expect the Bank to take a pause for an uncertain period of time, Pollick predicts a rate cut in 2020, caused by the currency issues.

In addition to it, investors also believe there could be a cut during the next 12 months, but it’s still not as large as a 1% decline expected in the U.S.

Bank of Canada rate decision is tomorrow, July 10 and we will update you here and through our social media channels.