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Financial Post:Issues dogging Dodge pile up (Dec 3, 2007)
http://www.financialpost.com/analysis/stor...626&k=91548
Bay Street divided on what rates will do
QUOTE The mental monetary policy gymnastics David Dodge in all likelihood was subjected to in the past few days must have been intense.
...
Here are some of the issues they likely tossed around:-Man who set this schedule? The November labour market report comes out three days after we issue our announcement. Surely that great big public hiring spree has started to cool off by now.
-If we hold interest rates steady at 4.50% and that fellow Bernanke at the Fed cuts U.S. rates to 4.25% or heaven forbid 4.0% next week, what the heck is the loonie going to do?
-This credit crunch is bad, but how much is it really going to squeeze borrowing in this country? And didn`t we want things to cool off anyway?
-Looks like exporters are really starting to take it in the neck but business investment is really zooming, Christmas has got to be big this year and there`s a whack of tax cuts coming.
-What`s with that loonie anyway, now it`s below par?
-Hey look, core consumer prices are at 1.8%, below our 2% target!
Bay Street is quite divided over whether the bank will actually pull the trigger on a rate cut tomorrow. They appear convinced, however, Mr. Dodge will leave his job at the end of January by kicking off a rate-cutting cycle.
http://www.financialpost.com/analysis/stor...626&k=91548
Bay Street divided on what rates will do
QUOTE The mental monetary policy gymnastics David Dodge in all likelihood was subjected to in the past few days must have been intense.
...
Here are some of the issues they likely tossed around:-Man who set this schedule? The November labour market report comes out three days after we issue our announcement. Surely that great big public hiring spree has started to cool off by now.
-If we hold interest rates steady at 4.50% and that fellow Bernanke at the Fed cuts U.S. rates to 4.25% or heaven forbid 4.0% next week, what the heck is the loonie going to do?
-This credit crunch is bad, but how much is it really going to squeeze borrowing in this country? And didn`t we want things to cool off anyway?
-Looks like exporters are really starting to take it in the neck but business investment is really zooming, Christmas has got to be big this year and there`s a whack of tax cuts coming.
-What`s with that loonie anyway, now it`s below par?
-Hey look, core consumer prices are at 1.8%, below our 2% target!
Bay Street is quite divided over whether the bank will actually pull the trigger on a rate cut tomorrow. They appear convinced, however, Mr. Dodge will leave his job at the end of January by kicking off a rate-cutting cycle.