The BOC is up this week! Here’s a list of the catalysts that might affect the Loonie’s price action this week.
BOC’s rate statement (May 29, 3:00 pm GMT)
While it held its rates steady in April, Bank of Canada (BOC) also abandoned any hints of hawkishness in favor of a more dovish tone.
Aside from downgrading its growth forecasts for 2019, Governor Poloz and his team also removed remarks referring to “the timing of future rate increases.”
Instead, the BOC shared that “an accommodative policy interest rate continues to be warranted” and that central bankers would add any “new negative disturbance” as “fodder for whether interest rates need to be revised down.”
This week analysts expect the central bank to maintain its interest rates at 1.75% for another month. Poloz could even adopt a more optimistic tone as retail sales and labour market numbers have shown improvements since the last meeting.
In fact, we might not see rate cut speculations rise again until we see the first growth figures for the second half of the year when the BOC expects the economy to pick up.
Oil price movements
In case you missed last week’s price action review, you should know that it was crude oil movements that encouraged most of the Loonie’s moves last week.
See, rising tensions between the U.S. and Iran pushed Black Crack prices higher early in the week. But rumors of the U.S. establishing measures for de-escalation; worries over the impact of U.S. and China’s trade war, and news of higher crude oil inventories weighed on crude oil until the end of the week.
Over the next couple of days, you’ll want to stay glued to the tube for any news that might hint at escalated tensions between the U.S. and Iran.
Oh, and don’t forget that the U.S. also publishes its weekly crude oil inventory on Thursdays at 4:00 pm GMT.
Further increases in crude oil supply could offset any gains from geopolitical tensions, so y’all better be ready for some volatility when you see them!
Missed last week’s price action? Read CAD’s price recap for (May 20 – 24)!