### POV: NO TIME TO PAUSE Breaking a.........>

CANADA: ### POV: NO TIME TO PAUSE

Breaking a string of 10 consecutive pauses, the Bank of Canada is expected to

cut the target rate Wednesday at 1000ET/1400GMT. In short order, the question is

not if the BoC will cut, but by how much?

- Dovish IS the base case: chances of a 50bp cut have gone from 5% last Friday

to near 70% in the aftermath of Tuesday's surprise 50bp intermeeting rate cut

with more down the road if the threat of a virus pandemic doesn't prove

transitory. Canada's Minister of Finance Bill Morneau said Tuesday that Canada

"can respond to potential challenges if needed" while the countries "fiscal

position gives it leverage to respond."

- Hawkish: Just not in the cards. While Canada has weathered the global economic

slowdown much better than others amid strong housing and improved housing

metrics, continued strength to the point were the BoC would consider a hawkish

policy is not a realistic scenario at least through summer.