Canadian Rate Increase Still Anticipated Despite Jobs Weakness
Dow Jones
Oct 09
1043 ET - The slump in Canada's labor market in September reduces the likelihood of a Bank of Canada rate increase late this month, but doesn't erase it, Oxford Economics' Tony Stillo argues. He continues to expect sustained inflation risk from higher gasoline prices will prompt the central bank to lift its policy rate a quarter percentage point in October and in December. But rather than starting a new tightening cycle Stillo expects the Bank of Canada will aim to swiftly return the policy rate to a neutral level as a pre-emptive move to ensure the spike in oil prices doesn't cause sustained higher inflation.
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