BoC preview: Dovish outlook still expected - RBS

FXStreet (Bali) - FX Strategists at RBS share their views on the Wednesday's BoC monetary policy decision, noting that despite recent improvements in Canada's economic indicators, the Central Bank will keep a dovish outlook overall.

Key Quotes

"The Bank of Canada decision should contain few surprises, particularly as tomorrow’s meeting will not include a release of new forecasts or the longer-form Monetary Policy Report (MPR)."

"We feel the BoC will be encouraged by the recent improvement in exports but will keep a dovish outlook overall, adding that a fall in July CPI inflation supports its baseline scenario that sustained, at-target inflation is unlikely given the size of the output gap."

"The BoC opting not to upgrade its language after strength in US and Canadian second-quarter GDP may be on the margin CAD negative."