BoC takes a look forward - ING

Analysts at ING point out that the BoC has hiked rates for the first time in seven years, despite all measures of inflation undershooting the target.

Key Quotes

“The Bank is taking a forward-looking approach to interest rates, anticipating a pick-up in inflation from the buoyant economy and labour market.”

“There’s more to come…

• We expect the BoC to continue the cycle with another rate hike this year. But the Bank will maintain some caution along the way:
• High household debt -$1.67 per $1 of disposable income –and booming house prices present a fine balancing act.
• There’s also still plenty of uncertainty surrounding Trump’s plans on NAFTA & trade.”