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Bank of Canada Governor Signals New Message on Canadian Economy; US Dollar Continues to Show Strength
Published April 24, 2018
Bank of Canada Governor Stephen Poloz and Senior Deputy Governor Carolyn Wilkins offered a slightly more optimistic take on the Canadian economy when the pair testified before the House of Commons Standing Committee on Finance in Ottawa yesterday.
Poloz noted strong progress on all four major concerns for the bank regarding the Canadian economy; his speech iterated that worries over inflation, wages, capacity in the economy and household sensitivity to higher interest rates have been somewhat abated in recent months.
USD/CAD has started the day lower as the market reacts to these fresh comments from Canada’s top monetary policy maker, especially that Poloz’s comments indicated he is not overly concerned with Canada’s inflation being over 2 percent.
The US Dollar Index, which measures the USD against a basket of six major currencies, rose to its highest level since January 2018 yesterday; this greenback rally comes as investors increasingly expect the Federal Reserve to raise interest rates three more times this year.
Oil prices remain near three-year highs this morning as investors await supply data from the American Petroleum Institute at 4:30 PM EST today; OPEC members and other major oil producers are set to meet again in June to assess their production cut while mulling over extension possibilities beyond 2018.
US Consumer Confidence and figures on new home sales are set to be released later this morning at 10:00 AM EST; the Richmond Manufacturing Index will also be released concurrently, capping off all economic data releases for the day.