BoC: Poloz indicated a pause and raised 2% puzzle - Scotiabank

Derek Holt, VP & Head of Capital Markets Economics at Scotiabank, would interprets the broad tone of BoC Governor Poloz's comments of last week as indicating they will skip a hike at the October meeting in favour of Scotiabank’s December hike call and therefore don’t disagree with a weaker currency in the aftermath given there were roughly 50–50 odds of a hike priced for October 25th.

Key Quotes

“The broad tone of the comments was roughly in line with our view that rates will rise slowly through 2018. His tone continues to leave the door open to further tightening but my reading of the overall speech suggests he’ll need more data before having enough comfort to hike again with the bigger tail risk skewed toward the next hike coming later than December rather than sooner.”