With the launch of the Bank of Canada’s latest announcement on interest rates and the economy tomorrow, there has been much speculation on whether a rate cut is in order, particularly in light of Canada’s sinking dollar.
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However, an Ivey economist is anticipating Canada’s central bank will stay the course on rates and keep its key rate at one per cent, where it has been since September 2010.
While a rate cut is not out of the question, Ivey Assistant Professor Mike Moffatt said it seems unlikely given the Bank of Canada’s reluctance to cut rates over the last few years.
“With the Canadian dollar and bond yields falling, markets appear to be expecting significantly bearish language in the next announcement,” he said. “There is a good chance that markets are over-reacting, as the Bank is unlikely to spook markets with apocalyptic language.”
Moffatt is available to comment on the Bank of Canada’s rate announcement and quarterly Monetary Policy Report, which will be released tomorrow at 10 a.m. He is an expert on the intersection of societal issues, public policy, economic growth, monetary policy and firm level strategy.
To arrange an interview with Moffatt, contact Ivan Langrish, Senior Manager Media Strategy at ilangrish@ivey.ca, or call 416-203-0664.
