BoC to weigh on CAD near term - Nomura

Analysts at Nomura noted that the Bank of Canada (BoC) kept rates on hold, but was more cautious in its assessment and outlook around inflation. 

Key Quotes:

"In particular, Governor Poloz noted that the bank is “more preoccupied” with downside risks to inflation and that is also highlighted risks stemming from the NAFTA renegotiations."

"Based on the BoC’s stance and still-tepid inflation pressures, we have pushed out the timing for the next rate hike from December 2017 to April 2018."

"The adjustment in market interest expectations should weigh on the CAD near term."

"We remain tactically long USD/CAD via a short-dated 1.2750/1.2900 call spread."