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December 6, 2021

The Week Ahead: RBA, BOC, CPI

Bart Kurek

Let's look at the news event's we've got lining up this week...

(AUD) RBA Rate Statement

The Reserve Bank of Australia is widely expected to keep interest rates on hold at 0.10% once again. Although there have been some notable improvements in the Australian economy's performance, policymakers are likely concerned about the Omicron variant that might prompt another downturn in growth. In their previous rate statement, the RBA has already hinted that their first rate hike most likely won't happen until 2024 due to weak price pressures and other uncertainties.

(CAD) BOC Rate Statement

The Bank of Canada is likely to keep rates on hold once again at 0.25%. The latest employment data has been stronger than expected in the past month, which might be enough for the BoC to shift to a slightly more optimistic stance. However, policymakers are also likely concerned about crude oil price swings and how the Omicron variant might affect growth and trade.

(USD) CPI

The Consumer Price Index (CPI) report measures the change in the average price basket of goods and services by consumers, which can be anything from food, transportation and medical care. Changes in the CPI are used to assess price changes associated with living in the country. It is one of the most used statistics to identify periods of inflation or deflation.

The USD is releasing its monthly inflation figures this week, and we're expected to see slightly slower price pressures as headline CPI is likely to dip from 0.9% to 0.7% while the core figure is probably going to fall from 0.6% to 0.5%. Weaker than expected results could undermine policy tightening expectations, especially with the Omicron variant forcing policymakers to wait and see before making any big decisions.

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