Comments from BOC Deputy Lawrency Schembri:
- In contrast to global economy, Canadian data since July has surprised on the upside
- Canadian economy has a "welcome degree of resilience" to possible negative economic developments
- Degree of stimulus remains appropriate
- Q2 GDP was 'much stronger' than forecast
- Inflation has been 'well behaved' and controlled, economy is operating close to potential
- Inverted yield curve is more-likely a sign that investors foresee weaker long-term growth
- Economy is clearly past its earlier soft patch, with strong jobs and a rebounding housing market
- National accounts data suggests some of the strength in GDP in Q2 could be temporary due to a jump in crude exports while imports were surprisingly weak
- Core inflation around 2% in July consistent with the idea that economy's output gap is essentially closed
There is no hint or mention of a rate cut here. The market is pricing in a 40% chance of a cut in October. Unless there is a US-China blowup or data turns south, I don't believe the BOC plans to make a move.
He will take questions after the speech. Watch it live here:
