FXStreet (Delhi) – Research Team at BNP Paribas, suggest that the Looney is at risk in case BoC comes with more dovish statements in its forthcoming meet on Wednesday. Key Quotes “Canada goes to the polls today and the latest opinion surveys are showing the Liberal Party’s lead over the Conservatives continuing to widen. Liberals have pledged up to $5bn a year in additional infrastructure spending.” “While an easier fiscal policy stance would over time imply less need for monetary easing, the longer-term nature of the spending plans suggests the impact probably would not be immediate.” “Meanwhile, our economists see a strong case for further policy easing but they expect the BoC to refrain from cutting rates on Wednesday. Recent communications from the BoC have been surprisingly optimistic and the money market curve is very flat; we think the risk is the message could turn more dovish, forcing the market to start pricing in a least some probability of a cut in the coming months.” “Furthermore, BNPP FX positioning analysis signals CAD short positioning has significantly moderated from -40 at the end of August to -16 currently (on a scale of +- 50; see here). We thus see upside risks to USDCAD around the announcement.” For more information, read our latest forex news.