PORTER TAKES TOP BANK TO TASK OVER INCREASE

Sep 11, 2017

By Michael Kramer

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The Bank of Canada says its silence ahead of an interest-rate hike last week wasn’t unusual.

Bank of Montreal chief economist Doug Porter says – he believes the bank had a strong case for the increase – but in a note to clients last Friday Porter said the Bank of Canada’s silent summer – created a great deal of uncertainty for markets ahead of the decision.

Porter claims the rate hike caught many analysts off guard  – but Jeremy Harrison, a Bank of Canada spokesman says – in three of the last four years the bank didn’t make any public remarks between the scheduled rate announcements in July and September.

And Harrison adds that market data before the hike showed roughly 50-50 odds of an increase – revealing that a much greater percentage of traders were correctly interpreting the bank’s most-recent messaging from early July.

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