{"id":32045,"date":"2018-03-07T12:32:42","date_gmt":"2018-03-07T17:32:42","guid":{"rendered":"http:\/\/olduvai.ca\/?p=32045"},"modified":"2018-03-07T12:32:42","modified_gmt":"2018-03-07T17:32:42","slug":"bank-of-canada-holds-rates-as-expected-warns-trade-growing-source-of-uncertainty","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=32045","title":{"rendered":"Bank Of Canada Holds Rates As Expected, Warns Trade &#8220;Growing Source Of Uncertainty&#8221;"},"content":{"rendered":"<div id=\"block-zerohedge-page-title\" class=\"block block-core block-page-title-block\">\n<h3 class=\"page-title\"><a href=\"https:\/\/www.zerohedge.com\/news\/2018-03-07\/bank-canada-holds-rates-expected-warns-trade-growing-source-uncertainty\"><span class=\"field field--name-title field--type-string field--label-hidden\">Bank Of Canada Holds Rates As Expected, Warns Trade &#8220;Growing Source Of Uncertainty&#8221;<\/span><\/a><\/h3>\n<\/div>\n<div id=\"block-zerohedge-content\" class=\"block block-system block-system-main-block\">\n<article class=\"node node--type-article node--view-mode-full\" role=\"article\">\n<footer class=\"node__meta\">\n<div class=\"submission-wrapper\"><\/div>\n<div class=\"a2a_kit a2a_kit_size_32 a2a_default_style\" data-a2a-icon-color=\"#222\">\n<div><\/div>\n<\/div>\n<\/footer>\n<div class=\"node__content\">\n<div class=\"clearfix text-formatted field field--name-body field--type-text-with-summary field--label-hidden field__item\">\n<p>Amid uncertainty around NAFTA (and Trump tariffs), and <strong>slumping economic data<\/strong>, The Bank of Canada was expected to &#8216;hold&#8217; and endorse the two rate-hikes priced into the curve (notably less hawkish than the growing belief in The Fed&#8217;s four-hikes), and that is what it did.<\/p>\n<p>However, BoC reiterated that continued accommodation is likely to be needed and added that it &#8220;remains cautious&#8221; and will be &#8220;guided by incoming data&#8221; in which case, sell the Loonie&#8230;<\/p>\n<p>It has not been a good month for Canadian economic data&#8230;<\/p>\n<p><a href=\"https:\/\/www.zerohedge.com\/sites\/default\/files\/inline-images\/2018-03-07_6-40-41.jpg?itok=ixhqyg54\" data-image-external-href=\"\" data-image-href=\"\/sites\/default\/files\/inline-images\/2018-03-07_6-40-41.jpg?itok=ixhqyg54\" data-link-option=\"0\"><img decoding=\"async\" src=\"https:\/\/www.zerohedge.com\/sites\/default\/files\/inline-images\/2018-03-07_6-40-41.jpg?itok=ixhqyg54\" \/><\/a><\/p>\n<p>BoC also acknowledged the recent deceleration in household credit growth (from record highs) and that trade is a &#8220;growing source of uncertainty&#8221; and flagged lower than typical wage growth.<\/p>\n<p><u><strong>Key Excerpts: <\/strong><\/u><\/p>\n<p><strong>BOC reiterates that &#8220;Governing Council will remain cautious in considering future policy adjustments&#8221; and be &#8220;guided by incoming data&#8221; <\/strong>and adds that while economic outlook &#8220;expected to warrant higher interest rates over time, some continued monetary policy accomodation will likely be needed&#8221; to keep economy near potential\/inflation on target&#8221;<\/p>\n<p>Of note,<strong>\u00a0 &#8220;Trade policy developments are an important and growing source of uncertainty for the global and Canadian outlooks&#8221;<\/strong><\/p>\n<p>Some <strong>housing demand &#8220;pulled forward&#8221; into 2017 from beginning of 2018<\/strong> ahead of new mortgage guidelines and other policy measures&#8221;<\/p>\n<p>Impact of housing policies, changes to mortgage guidelines and new provincial measures on housing demand and prices will take time to fully assess:<strong> &#8220;Notably, household credit growth has decelerated for three consecutive months&#8221;<\/strong><\/p>\n<p>The BOC says it will be guided by data in assessing the economy\u2019s sensitivity to interest rates, evolution of economic capacity and &#8220;dynamics of both wage growth and inflation&#8221;<\/p>\n<p><strong>&#8220;Wage growth has firmed, but remains lower than would be typical in an economy with no labour market slack&#8221;<\/strong><\/p>\n<p><strong>Inflation close to target and core measures have edged up,<\/strong> &#8220;consistent with an economy operating near capacity&#8221;; inflation fluctuating due to temporary factors<\/p>\n<p>The Loonie has been chopping around on Trump tariff and NAFTA headlines all week. CAD is little changed after the statement&#8230;<\/p>\n<p><img decoding=\"async\" src=\"https:\/\/www.zerohedge.com\/sites\/default\/files\/inline-images\/2018-03-07_7-02-31.jpg?itok=BJLExwUo\" \/><\/p>\n<\/div>\n<\/div>\n<\/article>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>Bank Of Canada Holds Rates As Expected, Warns Trade &#8220;Growing Source Of Uncertainty&#8221; Amid uncertainty around NAFTA (and Trump tariffs), and slumping economic data, The Bank of Canada was expected to &#8216;hold&#8217; and endorse the two rate-hikes priced into the curve (notably less hawkish than the growing belief in The Fed&#8217;s four-hikes), and that is [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[942,103,431,534,4318],"class_list":["post-32045","post","type-post","status-publish","format-standard","hentry","category-economics","tag-bank-of-canada","tag-canada","tag-interest-rates","tag-monetary-policy","tag-zerohedge"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/32045","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=32045"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/32045\/revisions"}],"predecessor-version":[{"id":32046,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/32045\/revisions\/32046"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=32045"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=32045"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=32045"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}