BoC to leave the overnight rates on hold - TDS

Research Team at TDS is in line with the universal consensus for the Bank of Canada to leave the overnight rate on hold at its March meeting.

Key Quotes

“The statement is likely to be largely unchanged, echoing the cautious, wait-and-see messaging of the December & January decisions. The Bank is again likely to reference the backup in yields and CAD headwinds with continued emphasis on significant labour market slack and economic divergence with the US.”

“Limited changes to the dovish language may disappoint more hawkish market expectations after relatively positive data of late have pointed to a more constructive outlook. On the contrary, we believe data has been mixed in light of the weakness registered in wage growth, hours worked and core inflation. The outlook also remains highly uncertain due to unclarified US policy changes.”