• Full statement
  • Higher rates are ‘less imminent than previously anticipated’
  • More muted inflation and better household debt reasons for delaying hikes
  • Cuts 2013 growth estimate to 2.0% from 2.3% (consensus is 1.8%)
  • Sees Q4 2012 at +1.0% vs 2.5% previously
  • Q12013 estimate lowered, rest of 2013 estimates hiked
  • Raises growth estimate in 2014 to 2.7% from 2.4%
  • Sees some cooling of the housing market

Spike higher in USD/CAD close to the December high of 0.9971. The statement is less hawkish but the growth estimates are stronger.

The kneejerk reaction in the market reflects the change in rhetoric but no one was expecting the BOC to hike rates in the next 12 months anyway.