Q&A continues:
Wilkins:
- there was quite a focus on a single word: Gradual
- it is time to be clear about what was on our minds (in decribing the omission of the word gradual
- It's possible the path of rates could be faster or slower
- households seem to be adjusting as we expected
- low prices for Canadian crude or subtracting from economic growth
- Strengthen US economy is coming from the fiscal stimulus. US economy will be contingent on fiscal policy stimulants
- US economy to be strongest in 2018. Sees a little bit of slowing in 2019 in the US
Recent drop in inflation validates Canada's analysis - there was a lot of discussion about how much uncertainty to remove because of USMCA trade deal
Poloz:
- when described neutral rate as a cap
- reaching neutral is the last element of normalization
- BOC policy is still quite stimulative
- policy stimulative at a time when economy is not in need
- economy could as easily be above as below capacity
- until some new shock throws us off trajectory, wouldn't be expecting to be going into contractionary stands for policy
- there still may be pockets of capacity labor market
- Every one of our meetings are LIVE
- "Gradual" meant we would only move every other meeting according to the market
- Taking out "gradual" means the rate changes can be faster, and they could be slower.
- It is our job to fend off overheating and inflationary pressures.
- various national and local measures have calmed down the housing market quite a lot
The USDCAD moved up to test the 200 hour MA and found sellers. Earlier in the day, the 100 and 200 bar MA on the 4-hour was tested and it found buyers.
The buyers and sellers are using the technical levels to define and limit risks.
