Goldman Sachs economists believe it is the latest rate hike for Bank of Canada (BoC) this Wednesday, as central bank likely to pause tightening for the future.
“Our economists expect the BoC slow the rate of rallies to 25 bps at this week’s meeting and pause thereafterassuming that inflation is in line with our forecasts.”
“We will be more focused on any possible changes in future guidance or comments from Governor Macklem on the strength of the labor market.
“Generally, risks lean towards a pause next week rather than a bigger-than-expected rally in our opinion, meaning USD/CAD faces upside risks at the meeting. Until then, if the dollar generally continues to break lower, which seems to have few near-term hurdles, CAD is likely to see additional weakness on crosses.”
Source: Fx Street
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