The Bank of Canada has had its critics in recent years, less so over its interest rate decisions than on its communication strategy. Its rate announcement in the week ahead will again put those latter skills to the test, as Governor Poloz tries to thread a very fine needle in terms of the message he conveys to the market.
Back in October, that task was much easier. The news of the day was a downgraded medium term outlook and a longer timeframe to return to full capacity. The central bankers could claim, with justification, that they actively considered cutting rates, a message that worked to send the Canadian dollar weaker and pull short rates lower, both welcomed as additional stimulus.