USD/CAD ticked to a session high of 1.0160 after the manufacturing sales figures.
The OIS market is pricing in an 11.6% chance of a cut and 9.5 bps of easing are priced in over the coming 12 months. All 24 economists surveyed by Bloomberg are expecting no change in the 1.00% overnight rate.
The BOC will surely cite slowing global and US growth in the statement but the key is the line that:
some modest withdrawal of the present considerable monetary policy stimulus may become appropriate
I expect this to be removed and it’s possible an easing bias will be inserted. If so, expect USD/CAD to rally to 1.02.
