CIBC expect the Bank of Canada to remain on hold at the policy meeting today:
1400 GMT is 10am US Eastern time.
Via CIBC, tipping no change at the meeting todat:
- US and Canadian labour markets have continued to drive above their non-inflationary speed limits. So central banks have to decide whether to pull them over and issue a ticket, by hiking rates again this month, or be a kinder cop and only issue a friendly warning this time, saving the rate decision for July.
- We lean towards the latter, particularly for Canada.
- The Bank of Canada is in the uncomfortable position of having to make a rate announcement … Wednesday, and then see the May jobs data on Friday. By using the June announcement to issue a stern warning that a rate hike could well be in the cards for July, they can keep bond yields and mortgage rates elevated, while putting off the decision until they have that data.
This article was written by Eamonn Sheridan at www.forexlive.com.
