Credit Agricole CIB Research discusses its expectations for next week's BoC policy meeting.
"Ahead next week it will be quiet in terms of market moving data releases with investors’ main focus being on the BoC’s monetary policy announcement. There appears to be limited dovish surprise potential when considering that central bank Governor Tiff Macklem sounded somewhat more constructive on growth when giving his first speech in June and as the labour market and business activity has been rebounding in the meantime. However, with downside risks as related to the coronavirus pandemic remaining intact, it appears too early for the central bank to suggest anything different from keeping interest rates stable for an extended period of time," CACIB notes.
"While our long-term view on the CAD remains one of strength, we believe better levels could be reached for considering new longs. This is well reflected in our September forecast, which is in line with levels closer to 1.37 in USD/CAD," CACIB adds.