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MNI BOC Review - June 2024: Easing Underway, Meeting-By-Meeting Approach

CANADA
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  • The Bank of Canada decided to cut the overnight policy rate by 25bps to 4.75%. The decision was in line with the majority of surveyed estimates, however, a minority had been forecasting an unchanged decision. The bank also decided to continue its policy of balance sheet normalisation.
  • The statement noted there is continued evidence that underlying inflation is easing and that policy “no longer needs to be as restrictive”. Regarding policy going forward, Governor Macklem suggested “it is reasonable to expect further cuts” to the policy rate if inflation allows, while emphasising that the Governing Council will take decisions on policy one meeting at a time.
  • Analysts remain divided over whether the BoC will cut again in July. Easing estimates for the remainder of 2024 appear to range from between 50-100bps.
  • The full review with analyst views is here: https://roar-assets-auto.rbl.ms/files/64653/BOCReviewJun2024.pdf

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  • The Bank of Canada decided to cut the overnight policy rate by 25bps to 4.75%. The decision was in line with the majority of surveyed estimates, however, a minority had been forecasting an unchanged decision. The bank also decided to continue its policy of balance sheet normalisation.
  • The statement noted there is continued evidence that underlying inflation is easing and that policy “no longer needs to be as restrictive”. Regarding policy going forward, Governor Macklem suggested “it is reasonable to expect further cuts” to the policy rate if inflation allows, while emphasising that the Governing Council will take decisions on policy one meeting at a time.
  • Analysts remain divided over whether the BoC will cut again in July. Easing estimates for the remainder of 2024 appear to range from between 50-100bps.
  • The full review with analyst views is here: https://roar-assets-auto.rbl.ms/files/64653/BOCReviewJun2024.pdf