The news from Wednesday US time:
- A comparison of the December to the October 26 statements from the BOC
- Bank of Canada interest rate statement for December 2022 meeting.
- Bank of Canada hikes rates 50 bps vs 50 bps expected
ING's take (in summary) on the Bank of Canada decision, the dovish 50bp hike:
- The market had been split as to whether the Bank of Canada would hike interest rates by 25bp or 50bp. Strong growth, a tight jobs market and elevated inflation led it to opt for the larger move, but having previously suggested ongoing tightening, the bank is now saying it is merely 'considering' whether additional hikes will be required
I can't help but reflect on what the Reserve Bank of Australia said earlier this week - that it 'expects' to hike rates further. Compared with the Bank of Canada saying its 'considering'. While there are plenty of analysts saying the RBA is done hiking I think that's not the case. The next Reserve Bank of Australia meeting is February 7, 2023. I'll be watching inflation reports (and more) ahead of then to get a feel for how likely a February rate hike is.
Anyway, back to CAD. ING compare BoC & Fed rates: