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Analysts (Mostly) Still Looking For June Cut After GDP [1/2]

CANADA
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  • BMO: “Canada's economy is just grinding forward, aided and abetted by solid U.S. spending trends, which are supporting exports. There's no debate that growth is nevertheless anemic, especially when cast in per capita terms (down more than 2% y/y). Business investment is notably weak. Even so, this changes little for the BoC, as conditions don't appear to be worsening so there's no urgency to cut rates. With growth still well below potential, disinflationary pressure will continue, but it will require ongoing patience.”
  • CIBC: GDP growth in Q4 and early tracking for Q1 “is running somewhat stronger than the BoC had assumed in its January MPR. However, activity has been driven largely by an easing of previous supply constraints helping exports and car sales, rather than necessarily an improvement in domestic demand. […] Today's data doesn't change our forecast for a first interest rate cut in June.”
  • Desjardins: “The domestic economy appears to be weakening as high interest rates weigh on consumers and businesses. The growth that was seen in Q4 didn’t come from within Canada’s borders and is particularly uninspiring given the population growth seen at the end of last year. We continue to expect that the BoC will begin a rate cutting cycle in June. However, risks remain skewed towards easing beginning earlier rather than later relative to our base case.”
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  • BMO: “Canada's economy is just grinding forward, aided and abetted by solid U.S. spending trends, which are supporting exports. There's no debate that growth is nevertheless anemic, especially when cast in per capita terms (down more than 2% y/y). Business investment is notably weak. Even so, this changes little for the BoC, as conditions don't appear to be worsening so there's no urgency to cut rates. With growth still well below potential, disinflationary pressure will continue, but it will require ongoing patience.”
  • CIBC: GDP growth in Q4 and early tracking for Q1 “is running somewhat stronger than the BoC had assumed in its January MPR. However, activity has been driven largely by an easing of previous supply constraints helping exports and car sales, rather than necessarily an improvement in domestic demand. […] Today's data doesn't change our forecast for a first interest rate cut in June.”
  • Desjardins: “The domestic economy appears to be weakening as high interest rates weigh on consumers and businesses. The growth that was seen in Q4 didn’t come from within Canada’s borders and is particularly uninspiring given the population growth seen at the end of last year. We continue to expect that the BoC will begin a rate cutting cycle in June. However, risks remain skewed towards easing beginning earlier rather than later relative to our base case.”