Highlights of the June 4th 2014 Bank of Canada monetary policy meeting
- Economy rebounding after pause in Q1 but could have slightly less underlying momentum that previously expected
- Economy grew at modest pace in Q1 2014 held back by bad weather and supply constraints
- Temporary effects largely behind rise in inflation to 2% target, Core inflation still significantly below 2%. Downside risks to inflation are as important as before
- Timing and direction of next rate move to depend on new data. Global financial conditions remain very stimulative
- Continued signs of soft landing in housing market, constructive evolution of household imbalances. Still expects excess supply in economy to be absorbed gradually
Full statement here
USD/CAD traded up to 1.0952 more on the the ISM than the rate decision and the BOC are still middle of the road when talking about rates. They are citing the jump in inflation as a one off, like Adam has alluded to but if we see another jump then that may start to sway the market. Inflation wise, Europe this ain’t.