Bank of Canada Expected to Sit Tight as Economy Gains Momentum

Dow Jones
08/07

1018 ET - A surge in Canadian employment in July following a strong preliminary second-quarter GDP growth estimate is further evidence the economy is gaining momentum after a weak start to the year, Capital Economics'Ariane Curtis says. Yet while the Bank of Canada is likely to sound more hawkish following the fall in the unemployment rate to a two-year low, it is unlikely to rush into tightening policy given the ongoing softness of wage growth and core inflation, the economist says. For now, Capital is sticking to the view that the bank will remain on hold this year.

 

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