Forex Investment and Currency Trading

Economics: The Bank of Canada is expected to keep rates on hold at 3%. Admittedly, there are arguments that extend in both directions. First, the economy is unambiguously weak. Second, the slowdown in economic activity has started to sow the seeds of some moderation in price pressures. Core CPI still remains below the Bank’s 2% [...]

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On June 10 the BoC shocked financial markets by not only keeping its key interest rate unchanged at 3.00% (there was almost unanimous consensus for a 25bps rate cut) but moved back from an easing to a neutral bias. After tougher inflation talk from the Fed and ECB ahead of the June 13-14 G8 summit, [...]

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Inflation fixation
This week saw a firmer-than-expected CPI report that served to cast some doubt on whether Canada can remain an “island” of low inflation. April’s monthly, seasonally-adjusted increase in the CPI of 0.4% (headline and core) heightened concerns that inflation may be percolating. To be sure, the nation’s inflation rate remains very subdued on an [...]

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