The Bank of Canada holds eight annual meetings where they stipulate the economic decision. For almost a year it has maintained the same level in the interest rate, the last modification happened in March 2020, when it went from 0.75% to 0.25%.
The forecast is that it does not change and is at 0.25% for the announcement that will be made on Wednesday. This decision strictly depends on inflation levels, which are forecast to reach 2% per year, according to the latest statement from the BoC.
The latest measurement published in February placed the January CPI at 0.6%, registering a slight increase. The interannual CPI stood at 1%, therefore considering the levels estimated by the BoC for the modification of the interest rate, it will probably be renewed for a new period at 0.25%.
Variations in Canadian employment will also be released this week. The last published unemployment rate registered an increase from 8.9% to 9.4%, it is analyzed that the new result is located at 9.2%.
Regarding the variation in employment, the last record was higher than expected, giving -212.8K. The projection estimates a variation towards 105.5K.
The reduction in the unemployment rate and the positive variation in employment levels may be positive for the CAD.
USDCAD remains in sell preference below 1.27. Sell are possible from 1.2630 to 1.26. The buy preference is maintained from 1.27 to 1.2730.