Head of FX Strategy
The Bank of Canada kept rates unchanged as widely expected and the statement released with the decision drops the reference to the need to be “cautious” on further rate rises, a move that is seen as hawkish relative to expectations. But there was also a bit of a revision of the language in the description of the need to hike interest rates, with a switch to the word “gradual” apparently seen as an upgrade relative to the prior wording.
The short end of the yield curve rose several basis points from the day’s low, but is still within the trading range of the last couple of days, so the takeaway in rates doesn’t seem as immediately dramatic as the immediate spike higher in CAD in the wake of the statement.
In USDCAD, the key USD pair, the 1.2900 area is important on a daily close basis for testing whether the USDCAD rally is danger of further unwinding here. Elsewhere, independent of the USD outlook, this statement could prove supportive in CAD crosses like AUDCAD, which has backed up sharply of late.
The market is trying to get back to the pre-Covid and pre-war times, but that model is broken. A new dawn is here and the financial world needs to adapt.
Steen Jakobsen,
Chief Investment Officer
A political switch in China towards less tough control of its people and companies may kick things back into gear.
Redmond Wong,
Market Strategist
While the economic situation in Europe may not be as bad as feared, there's still a plethora of things to fix.
Chris Dembik,
Head of Macroeconomic Research
As the world turns increasingly bipolar, equity markets face harsh times as they transition into the new reality.
Peter Garnry,
Head of Equity Strategy
New alliances and collaborations outside of China may lead to prosperous times in Asia.
Charu Chanana,
Market Strategist
For years, it was thought that the balanced portfolio was a thing of the past. But recent developments may have changed that.
Peter Siks,
Investment Coach
Following a dramatic and volatile 2022 with good returns, a lot of this year's commodity performance may be driven by Chinese politics.
Ole S. Hansen,
Head of Commodity Strategy
2023 could be a tough year for currencies but EUR and JPY may have some upside.
John J. Hardy,
Head of FX Strategy
The commodity-heavy Australian market may have a good start to 2023, as the Chinese focus on growth signals demand for Aussie resources.
Jessica Amir,
Market Strategist
From a near-perfect environment for speculative assets before 2022 to the opposite, crypto faces fundamental challenges.
Mads Eberhardt,
Cryptocurrency Analyst
