| Time | Country | Event | Period | Previous value | Forecast | Actual |
|---|
| 06:30 | Switzerland | Consumer Price Index (YoY) | May | 1.4% | 1.4% | 1.4% |
| 06:30 | Switzerland | Consumer Price Index (MoM) | May | 0.3% | 0.3% | 0.3% |
| 07:55 | Germany | Unemployment Change | May | 10 | 10 | 25 |
| 07:55 | Germany | Unemployment Rate s.a. | May | 5.9% | 5.9% | 5.9% |
CAD weakened against most of its major counterparts in the European session on Tuesday as investors prepared for an announcement of the Bank of Canada’s interest rate decision on Wednesday.
Markets widely believe that the recent Canadian data showing consumer price inflation moving deeper within the BoC’s 1-3% target range in April, the unemployment rate holding at a two-year high, annual wage growth easing to a 10-month low, and a slower-than-forecast GDP expansion in the first-quarter give the BoC’s policymakers an argument to deliver an initial 25-basis-point interest-rate cut tomorrow. This would mark the first decrease in the Boc’s benchmark interest rate since March 2020 - when the COVID-19 pandemic began - bringing it to 4.75%.
Investors will scrutinize the statements of Canada’s central bank for clues on the prospects of further monetary policy easing over the coming months. The BoC is anticipated to send cautious messages regarding its future moves, warning against reducing rates too much too quickly.
Ahead of tomorrow’s announcement, markets expect at least three rate cuts from the BoC this year.