BoC on 'Hold' for a while ? | General financial discussion | Discussion forum

Bud said
If u.s. cuts theres room for BoC to cut do u think? I hope not  

There is always that "monkey see, monkey do" possibility, but in the current environment it's my expectation the BOC would only follow a US cut if the loonie started getting too strong as a result and thereby started to pose a threat to Canadian exports.

In the absence of such pressure, however, IMO they would be wise to simply leave everything where it lies and keep fostering that same old aura of Canadian financial stability to the rest of the world, especially so close on the heels of a federal election.

As for the US cutting rates, I'm not so sure they want to be doing that just yet because of all the mixed signals in the economy -- some data is strong while other data is weak -- plus they currently have a problem in their overnight repo market to solve first because of the inverted yield curve, which is technically pressuring US short term rates up while the Fed is busy printing money trying to hold them down. As long as that little tug-of-war stays neutral, I expect little to change but what the heck do I know