-Bank of Canada
As markets expected, the Bank of Canada left its benchmark overnight rate on hold at its January policy meeting on Thursday, where it has been since the middle of 2015. The Central Bank suggested that the economy is likely to get a hit from the President –elect Donald Trump's protectionist policies. However, the BoC said that the value of any potential damage arising from Trump's administration cannot be reasonably estimated at this time. The decision to keep the key interest rate at 0.50% was driven by high uncertainty surrounding Trump's presidency. The biggest concern about Trump from an economic point of view is whether he will introduce high customs duties and review the North American Free Trade Agreement or not, as the US is the main trading partner of Canada. Nevertheless, the US President-elect's intention to cut the corporate and personal income tax will probably benefit the Canadian economy.
In addition, the Bank of Canada upgraded its economic growth projections for the upcoming years. According to the Bank's forecasts, the Canadian economy is likely to expand 2.1% in both 2017 and 2018.
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