All eye on BoC after Lanes warnings - UOB

Analysts at UOB Group noted that The Bank of Canada Deputy Governor Tim Lane who was speaking before the Saskatoon Regional Economic Development Authority on Monday (18 Sep) said that the central bank will be paying ‘close attention’ to how the economy responds to higher interest rates and stronger CAD. 

Key Quotes:

"The BOC is seeing widespread strength in business investment, exports, along with global economic expansion but the possibility of a material protectionist shift, particularly on possible changes to NAFTA, is a key source of uncertainty for Canada’s economic outlook."

"He warned that trade negotiation outcomes could have implications for the economy, which BOC would need to consider in conducting monetary policy and that it will be watching trade developments and implications for exports, business investment very closely."

"Lane’s comments sent the CAD surging 0.86% with the USD/CAD to close at 1.2291."