BoC is universally expected to keep its overnight rate unchanged - TDS

Research Team at TDS, suggests that the Bank of Canada is universally expected to keep its overnight rate unchanged at 0.50% tonight and while Governor Poloz will likely maintain that the economic recovery remains broadly on track, the updated forecasts provided in the MPR may tell another story.

Key Quotes

“Downward revisions to domestic growth are likely due to the impact of the Alberta wildfires, slowdown in non-energy exports and uncertainty resulting from the EU Referendum. However, given the already elevated levels of household leverage and incoming fiscal stimulus, the threshold for further accommodation from the Bank is very high which gives Poloz a reason to avoid sounding overly dovish. The statement and MPR will be followed by a press conference at 11:15 ET. On the data front, the Teranet House Price Index for June is the lone release of the day.”