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The Fonz · 05-01-2024, 11:42 AM

https://www.bnnbloomberg.ca/disappoi...data-1.2067100

Economists believe Canada’s latest economic data will persuade the Bank of Canada to make its first rate cut of this tightening cycle in June, marking a significant divergence from the U.S. Federal Reserve...

...“Not only did we see a revision to January, which was coming into the year looking quite strong, we've missed consensus in February and it looks like we're flatlining in March. All that points to growth under one per cent for the quarter analyzed, I would think, which is well below the Bank of Canada's expectations.”

Tu Nguyen, an economist with RSM Canada, said the data shows “little steam left in the Canadian economy,” and added that a rate cut is imminent, even if the Fed holds for longer.

“It is undeniable that the growth gap between the stagnating Canadian economy and a resilient U.S. economy has widened,” she wrote in a news release. “This will lead to a divergence in the policy paths of the two central banks, with the Bank of Canada cutting in June and the Fed waiting until September"...

...“Our view is that policy divergence is closer than it has been this cycle; lower expected growth in Canada and a more rate-sensitive economy is likely to force (Bank of Canada) policy to diverge with The Fed in a meaningful way over the next few quarters,” he said in a news release...

...“Based on where inflation is going in the Fed and where the Fed's bar is for cutting, it's quite possible that we could see two or three cuts before one comes in the Fed.”

05-01-2024, 11:42 AM	#2108
The Fonz Our Jessica Fletcher Join Date: Dec 2004 Exp:	https://www.bnnbloomberg.ca/disappoi...data-1.2067100 Economists believe Canada’s latest economic data will persuade the Bank of Canada to make its first rate cut of this tightening cycle in June, marking a significant divergence from the U.S. Federal Reserve... ...“Not only did we see a revision to January, which was coming into the year looking quite strong, we've missed consensus in February and it looks like we're flatlining in March. All that points to growth under one per cent for the quarter analyzed, I would think, which is well below the Bank of Canada's expectations.” Tu Nguyen, an economist with RSM Canada, said the data shows “little steam left in the Canadian economy,” and added that a rate cut is imminent, even if the Fed holds for longer. “It is undeniable that the growth gap between the stagnating Canadian economy and a resilient U.S. economy has widened,” she wrote in a news release. “This will lead to a divergence in the policy paths of the two central banks, with the Bank of Canada cutting in June and the Fed waiting until September"... ...“Our view is that policy divergence is closer than it has been this cycle; lower expected growth in Canada and a more rate-sensitive economy is likely to force (Bank of Canada) policy to diverge with The Fed in a meaningful way over the next few quarters,” he said in a news release... ...“Based on where inflation is going in the Fed and where the Fed's bar is for cutting, it's quite possible that we could see two or three cuts before one comes in the Fed.”