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CAD weakness should not prevent BoC from cutting rates - BNPP

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Jan 19, 2016.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

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    FXStreet (Delhi) – Economists at BNP Paribas, expect the BoC to cut rates by 25bp on Wednesday as CAD weakness will not fully offset the negative impact from weaker oil prices.

    Key Quotes

    “Updated crude oil forecasts from our commodity strategy team suggest prices will recovery only moderately from current levels over the next three quarters, implying the BoC needs to do more to stimulate the economy. Markets are now pricing in a 70% chance of a cut this week.

    Meanwhile, the CAD currently stands as the largest short in G10 FX according to our positioning analysis, but with a score of -37 there is room for further short positioning to be built if the BoC does cut rates as we expect.”
    For more information, read our latest forex news.
     

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