Preview of the Bank of Canada monetary policy meeting on Wednesday 09 September 2015 from Barclays
- Barclays expect the BOC to keep its overnight lending rate unchanged at 0.5%
- Barclays do expect, though, that further monetary easing will be needed in the near future
- Expect another cut before year-end
Further:
- The effects of low oil prices are still being felt on the economy
- Economy officially slid into recession in Q2
- "Decent behavior of consumption'
- Still-resilient labor market
- But significant downside risks to economic activity
- Continued weakness in the energy sector has depressed investment, which we expect to remain subdued for the rest of the year
- We continue to expect weakness in the price of commodities as nervousness about China dominates the price action
- Canadian oil producers face very high extraction costs, and tight margins due to low oil prices will likely continue to slow capital expenditure, hurting aggregate investment even further
