BoC is unlikely to jettison its dovish tilt - Westpac

Richard Franulovich, Research Analyst at Westpac, suggests that while the BoC is unlikely to jettison its dovish tilt amid ongoing uncertainties around Trump’s trade policies Poloz is nevertheless likely to sound incrementally more upbeat next week.

Key Quotes

“Westpac’s data surprise index for Canada is testing 18 year highs and Q1 GDP growth is tracking comfortably above 3% annualised. The BoC is likely to upgrade its 2.1% GDP growth forecasts for 2017 and 2018 and should tone down its assessment that there is still material excess capacity.”

“CAD offers decent value on some crosses. AUD/CAD is notably expensive above parity, especially given the contrast between Canada’s stronger data trends lately versus patchy Australia data and with oil prices exhibiting more stability of late than iron ore.”