The press conference will begin at 10:30 am ET but the opening statement was pre-released:
- We took a bigger step today because inflation is now back to the 2% target and we want to keep it close to the target.
- Price pressures are no longer broad-based
- We need to stick the landing
- Household spending and business investment have picked up this year, but remain soft
- We anticipate cutting our policy rate further to support demand and keep inflation on target
- We will take our monetary policy decisions one at a time
- We expect growth in residential investment to rise as strong demand for housing lifts sales and spending on renovations
- Exports should remain strong, supported by robust demand from the United States
- We view the risks around our inflation forecast as reasonably balanced
BOC pricing for the December 11 meeting suggests at 25% chance of another 50 bps cut.
I find the line about residential investment to be off-base. The mortgage market has already priced in much lower rates and there's no real life in the housing market, if anything it's worsening and the investor class is abandoning new home construction. That's incompatible with rising home sales and reno spending.
