FX Daily Update
The National Bank of Canada | Jul 14, 2016 09:11AM ET
Bank of Canada maintains course
To no great surprise, BoC Governor Stephen Poloz announced yesterday that the bank’s key rate would stay at 0.5%. The BoC also downgraded its growth projections for 2016 from 1.7% to 1.3% citing a reduced contribution from net exports (1.3% to 0.8%). On a more positive note, the bank believes that third quarter growth will come in at 3.5%, due mainly to resuming operations in Alberta. The generally more optimistic tone of the report certainly took markets by surprise, and the USD/CAD pair is trading some 100 points lower this morning despite crude oil prices languishing at $45 a barrel.
This morning, the Bank of England announced its key rate decision, with Governor Mark Carney also holding steady at 0.5%, although there could be an adjustment at the next meeting in August. In North America, we’ll be keeping an eye on Initial Jobless Claims and Producer Price Index data south of the border and the New Housing Price Index in Canada.
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