Decision day but don't expect any surprises say economists

by Steve Randall04 Sep 2019

Survey after survey has revealed a similar view from leading economists in Canada and internationally; there will be no change in Canadian interest rates this month.

The Wall Street Journal offers up the latest survey to reinforce the opinion that the Bank of Canada will not follow the route taken by the Fed and some other central banks which have been cutting rates.

The panel of economists polled by the WSJ shows that 10 out of the 11 believe the BoC will hold rates at 1.75% today (Sept. 4) and as with other recent polls, they expect a cut at some point but cannot agree on when.

However, economists may be becoming less dovish on when the BoC will take action.

While opinion had been pointing towards a cut in rates late in 2020, a recent poll by showed a greater share of economists believe that the cut could come earlier next year. A separate poll from Reuters also suggests a cut could come in the first quarter of 2020.

And the WSJ panel believes that the rising trade tension between the US and China will be a key factor in a rate cut especially as there are some signs that Canada is already being impacted.

Two of the economists polled expect a rate cut in October 2019.

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