- Rates left unchanged at 0.25%, as widely expected
- Omicron has injected renewed uncertainty
- Uncertainties arising from the Omicron variant could weigh on growth by compounding supply chain disruptions and reducing demand for some services
- Canada’s economy grew by about 5½ percent in the third quarter, as expected
- GDP is about 1.5% below pre-pandemic
- Persistent supply bottlenecks continued to inhibit growth in parts of the economy
- Recent economic indicators suggest the economy had considerable momentum into the fourth quarter
- impact of global supply constraints is feeding through to a broader range of goods prices
- Continues to see inflation back towards 2 percent in the second half of the year
- Repeats that slack to be absorbed "sometime in the middle quarters of 2022"
- Economic growth in the United States has accelerated
- Growth in some other regions is moderating after a strong third quarter
There is no press conference scheduled for after this meeting but Macklem will have a speech tomorrow.
USD/CAD rose to 1.2645 from 1.2610 on the release.There was no sign of a rush to tighten here and the market is pricing in a decent chance of a January hike.
The message from the statement is largely positive but not as enthusiastic as what we heard from the RBA earlier this week. The upbeat comments are also tempered by two instances where they highlight omicron risks. That suggests the Bank of Canada is going to wait and see how it unfolds. The forward guidance continues to suggest a hike in the April-Sept range and for now the BOC is happy to leave it at that.
USDCAD 3 min chart
