RBC execs:
- Expect Canadian economy to continue softening in 2025 with GDP and population growth slowing
- Credit losses to be in the mid 30s and peaking in the second half of the year
- Canadian economy has been underperforming, expects BOC to continue cutting rates more aggressively than the Fed
- Backdrop in the US has been far more resilient
- Potential of expansive US fiscal policy could create uncertainty around the size and timing of monetary policy actions
National Bank execs:
- Canadian economy to experience slower growth in H1 as interest rates remain restrictive
- Economy will face uncertainties related to path of mon pol and divergence between the BOC and Fed
- Challenging credit environment expected to temper net income growth for financial markets segment
With the ECB essentially teeing up a 25 bps cut and the Fed leaning towards 25 bps, the Bank of Canada is shaping up to be the toughest central bank decision to handicap. The market is pricing a 53% chance of 50 bps and a 47% chance of 25 bps for the Dec 11 meeting.
Based on these comments, they would be wise to go big but that will further weigh on the Canadian dollar.
